Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

Oral Answers to Questions — TRADE

Travel Agents

Mr. McCrindle: asked the Secretary of State for Trade if he has any plans to meet representatives of travel agents in the near future.

The Under-Secretary of State for Trade (Mr. Clinton Davis): Before I answer the Question, perhaps I may apologise to the House on behalf of my right hon. Friend the Secretary of State for Trade, who is at present on an official visit to India. I hope that nothing goes too sadly amiss today.
Ministers met members of the Association of British Travel Agents—ABTA—on 8th February and on 26th February, this time with the Guild of British Travel Agents among other representatives of the

travel trade. My hon. Friend the Under-Secretary expects to have a further meeting shortly.

Mr. McCrindle: Will discussions be taking place between Ministers and representatives of the travel agents on the important matter of the possible registration and licensing of travel agents? Will the Minister take this opportunity to spell out the Government's policy on this matter with greater clarity than has hitherto been the case?

Mr. Davis: The hon. Gentleman is aware, of course, as he was present during the debate when I announced it, that we are setting up a working party to look into the question of the discounting of fares by bucket shops. The question of registration and licensing will almost certainly fall within its terms of reference.

Mr. James Lamond: Will my hon. Friend also discuss with ABTA the question of some of its members advertising holidays in the Turkish-occupied section of Cyprus in hotels that have been confiscated by the Turkish authorities from their owners and for which no compensation has been paid, all of this being done against the wishes of the hotel owners?

Mr. Davis: That matter has only just been brought to my attention by my hon. Friend. I shall certainly ensure that it is investigated.

Mr. Parkinson: When the Minister sees representatives of the travel agents, will he ask them whether they think that


their customers prefer the higher fares that the CAA seems to think it is the duty of airlines to charge, or the lower fares which airlines such as Braniff have proposed? Will he tell some of his officials that, much as they may resent it, Sky-train flew and is a success, and that the public are becoming increasingly impatient with fares that are higher than they need to be?

Mr. Davis: That clearly does not arise out of the Question. The hon. Gentleman is being very simplistic—as are the Opposition on so many occasions. He knows very well that it was the United States Government that permitted Sky-train to operate for only 12 months, and he also knows very well, or should know, that there are additional questions of great importance affecting the viability of airlines which must be investigated.

Mr. Parkinson: Rubbish.

Mr. Davis: The hon. Gentleman cannot get away with it by saying "Rubbish". If, as he so often propounds, there is need for quieter engined aircraft in order to protect people on the ground, he must realise that this involves very considerable investment, and this is a factor that needs to be taken into account.

Footwear Imports

Mr. Fry: asked the Secretary of State for Trade what representations he has received from shoe importers or others to relax current controls of imports of footwear; and if he will make a statement.

The Under-Secretary of State for Trade (Mr. Michael Meacher): I have received some written representations from importers and I met representatives of the British Importers Confederation. The Government are satisfied that the action taken to restrain imports was necessary to safeguard the United Kingdom industry from disruption.

Mr. Fry: I thank the Minister for his reply. Will he confirm that the British footwear industry plays a very important part, not only in exporting but also in import substitution, and therefore fully deserves to be protected against dumping and unfair competition? [HON. MEMBERS: "Oh."] Yes. In fact, its labour relations record is so good that

it certainly needs protection more than other industries, such as the motor industry, in which labour relations are bad.

Mr. Meacher: I confirm the importance of the footwear industry and the jobs in it and the determination of the Government to ensure fair trading practices and to protect the footwear industry—and, indeed, any other industries—from dumping or unfair practices.

Mr. John Garrett: My hon. Friend will be aware that the recent report of the footwear study group, on which Conservative as well as Labour Members of Parliament served, proposed that there should be planning agreements between the Government and large retail footwear distributors who import many of their needs. In view of all-party support for planning agreements, in this case aimed at protecting footwear industry jobs, will my hon. Friend promise some action in the near future?

Mr. Meacher: Along with my right hon. Friend the Secretary of State for Industry, we in the Department are anxious to extend the coverage of planning agreements. With that in mind, we have recently had discussions with various distributors. I hope that as a result there will be closer collaboration between manufacturers and retailers in this industry.

Mr. Michael Morris: Is the Minister aware that there is an improved trade balance on footwear and that the industry recognises the role played by the Government in taking action against dumping? But, recognising that the industry is putting its own house in order, do the Government think that the time has come when the British Overseas Trade Board must be a little more generous in its attitude towards footwear exports and assistance to footwear exporters?

Mr. Meacher: I am not sure to what the hon. Gentleman is referring. The BOTB gives full assistance to footwear exporters. If he is referring to the fact that there are high tariffs in certain developing countries, he can be assured that we are making the strongest representations that we can through the Commission in the multilateral trade negotiations to get unfairly high tariffs reduced and better reciprocation.

Tourism

Mr. Silvester: asked the Secretary of State for Trade what discussions he has held with interested parties on plans further to promote tourism in the North-West; and if he will make a statement.

Mr. Knox: asked the Secretary of State for Trade what measures he is taking to assist the development of the tourist industry in the Leek parliamentary constituency, in view of the recent expenditure on promotion of tourism in development areas.

Mr. Blaker: asked the Secretary of State for Trade what recent discussions he has had with the English Tourist Board regarding its strategy for marketing English holidays for residents in the United Kingdom.

Mr. Gwilym Roberts: asked the Secretary of State for Trade what additional steps he is taking to encourage tourism outside the development areas; and if he will make a statement.

Mr. Meacher: The Government currently provide more than £15 million a year to the English Tourist Board and to the British Tourist Authority, of which only about £2 million is for assistance to tourism projects in the development and special development areas. Most of the remaining £13 million is spent on publicity and marketing, which benefits all regions, including the North-West and the Midlands.

Mr. Silvester: Does the Minister agree that tourism can provide as much employment as manufacturing? Will he, therefore, look again at the question of areas in the North-West which are outside development areas but which are nevertheless the best for tourist development?

Mr. Meacher: There may be some misunderstanding about the position. Out of a total tourism budget of just under £20 million, nearly £16 million is used for publicity and research and general promotion, which benefits all parts of the country and not only the development in special development areas. That is four-fifths of the total budget.
If we are talking about the remaining £2 million only which is available to the

English Tourist Board in the coming year for project aid, if that were distributed over the whole country it would dilute its effectiveness to an unacceptable degree.

Mr. Knox: Is the Minister aware of the considerable concern of those trying to develop the tourist industry in my constituency? Does he agree that expenditure by the English Tourist Board on advertising discriminates strongly against those in my constituency and in favour of the development areas? This is a further burden and difficulty and discriminates against the tourist industry in my constituency. Does he realise that people find it difficult to make the industry prosper?

Mr. Meacher: On the specific point about advertising, I disagree that there is any discrimination in ETB advertising against parts of the country outside development areas. The traditional resorts and the development areas are not competing for the same market. They are not promoting the same product. The main annual advertising campaign of the ETB, such as the "Let's Go" leaflet, is directed at helping the traditional resorts as against the foreign resorts.

Mr. Blaker: Although I welcome the work done by the English Tourist Board, is the Under-Secretary of State aware that a recent document entitled "Advertising Strategy for the English Tourist Board" prepared for the board by an organisation called KMP Limited, a firm of advertising agents, advocates a strategy not simply of encouraging extra tourists into development areas but of diverting the existing English tourists from the resorts to development areas? Does he approve of that strategy?

Mr. Meacher: We are certainly concerned, in accordance with the November 1974 guidelines, to shift an increasing proportion of the extra number of tourists coming into this country into the less congested areas, where there is a great deal of undeveloped tourism potential. But that is perfectly compatible with promoting the traditional resorts. As I have indicated, the main annual advertising campaign of the ETB is directed towards those resorts, including that of the hon. Gentleman.

Mr. Roberts: Is my hon. Friend aware that in recent correspondence that we


have had I have drawn his attention to the situation in which the English Tourist Board is using enormous advertisements for parts of development areas whereas areas such as the heart of England, including in and near Shakespeare country and Cannock Chase, are getting only the minimum of advertising? Is his Department mixing the twin aims of helping the development areas on the one hand and stimulating tourism on the other?

Mr. Meacher: No, it is not. I think that the two aims are perfectly compatible. We are often criticised because there is too much congestion, for example, in Stratford, Oxford or London, and there is pressure on the ground of alleged people pollution—which is becoming the fashionable phrase—to move people out of those areas. I do not think that my hon. Friend need worry. Stratford and these other areas will continue to receive very strong support from the British Tourist Authority in foreign advertising.

Mr. Heffer: Has my hon. Friend had the opportunity of reading the excellent booklet, published in conjunction with the English Tourist Board and the Merseyside County Council, which describes the facilities which exist on Merseyside—not only the seaside resorts, but many other facilities, such as museums, music and the arts? Will he tell the hon. Members who are opposing the proposition that there should be extra tourist facilities for areas such as mine that we are doing a great disservice to those areas, which require all the assistance that they can get?

Mr. Meacher: I am well aware that the "Costa del Ribble", or whatever area my hon. Friend is promoting, does not need further assistance in order to promote its tourism. The point that I am making is that we have £2 million only in the English Tourist Board in the coming year for all tourism project aid. If we distribute it across the whole country, the impact of that money will be lost.

Mr. Nott: May I take up the question of what the Minister described as people pollution, a new and interesting term? If Labour Members of Parliament no longer wish to take their holidays in the Cornish development area, I am sure that this is a loss of tourism traffic which we can reasonably bear with equanimity.

Mr. Meacher: The hon. Gentleman's view of what constitutes people pollution in Cornwall is a matter for him.

European Community (Exports)

Mr. Dykes: asked the Secretary of State for Trade what study has been made by his Department in recent months concerning patterns of trade in exports between the United Kingdom and other EEC countries.

Mr. Meacher: Results of a study of the general pattern of trade were published in the article "Trends in Trade with Western Europe" in the annual report of the British Overseas Trade Board for 1977. Reports on trade with individual EEC countries were circulated at the board's Wembley conference in November.

Mr. Dykes: Is it not remarkable that since 1975, on a balance of payments basis, the trade deficit has fallen from £2·4 billion to £1·29 billion, although there has been a rise in the ratio of United Kingdom trade with other EEC countries? Is the real problem no longer the old deficit, particularly with EEC countries, but the deficit with countries in the rest of the world and particularly countries which do not practise full and fair trade, such as Japan?

Mr. Meacher: The hon. Gentleman is perfectly right that there is a major trading problem with Japan. But he skates over the fact that there has been a very substantial deterioration in our trading position with the EEC countries. In the four years from 1969 to 1972 the United Kingdom trade deficit with Western Europe was £240 million a year. In the four years after we joined the EEC the United Kingdom trade deficit with Western Europe was £2,380 million a year, of which £1,950 million was attributable to the poorer trade balance with the EEC. This is still a major problem.

Mr. Kelley: Is my hon. Friend happy with the situation in the coal industry? Is he aware that considerably greater amounts of coal are being imported into Europe than are being exported? Is this not contrary to the terms we expected when we entered the Common Market in 1972?

Mr. Meacher: I am not sure whether my hon. Friend is suggesting that the


trade in coal is in some sense discriminatory. As far as I know, we have not received representations suggesting that imports of coal from outside the EEC discriminate against internal trading in coal within the EEC.

Mr. Marten: Is not the trend that in recent months exports to the EEC have been declining while imports have been increasing? Is not the import problem partly due to the need to import high-cost food from the Common Market? Does not the hon. Gentleman agree that the sooner we can bail out the CAP the sooner my hon. Friend can make a better case for our membership of the EEC—if there is any case—because we shall then be able to buy our food on world markets?

Mr. Meacher: The problem of the displacement of food supplies following our accession to the EEC is well known. It is a major problem. As for the recent trend in trade, the export-import ratio has improved over the past couple of years to about the position that it was in 1972. In the fourth quarter of last year it started to deteriorate again slightly.

Gatwick Airport

Mr. Geoffrey Johnson: Smith asked the Secretary of State for Trade what air safety requirements have been taken into account when considering a throughput of 25 million passengers a year at Gat-wick Airport operating on a single runway.

Mr. Clinton Davis: Standard air traffic control criteria which ensure the safe separation between aircraft taking off and landing have been used in forecasting the runway capacity at Gatwick. There is no question of any dilution of these strict ATC criteria or of accepting lower safety standards in calculating the forecast.

Mr. Johnson Smith: Is the Minister aware that there is no airport in the world with one runway which has a throughput of 25 million passengers and that, as a consequence, local opinion is suspicious that in a few years the Minister or his successor will be forced to come to this House and ask for a second runway because the requirements of safety demand it?

Mr. Davis: I am aware of what the hon. Gentleman has said in the first part

of his supplementary question, but the fact is that the British Airports Authority is of the view that there is no need for a second runway. The important point to stress is that there will be absolutely no compromise on or degrading of the safety issue, which is of paramount concern.

Mr. Hugh Jenkins: Does my hon. Friend agree that it would be better to build a second runway at Gatwick than to have a fourth terminal at Heathrow?

Mr. Davis: My hon. Friend knows very well that the question of the fourth terminal is before a planning investigation. I cannot, therefore, comment upon it. As for the second runway, I have given my answer on that. It is not within our contemplation.

Mr. Shersby: What estimate has the Minister made of the cost of improving road and rail links between Heathrow and central London as compared with the cost of £10 million to £15 million for providing an extra runway at Gatwick?

Mr. Davis: The House seems to be divided, although not necessarily on party lines, on this issue. Hon. Members must address such questions to my right hon. Friend the Secretary of State for Transport.

Film Industry

Mr. Hugh Jenkins: asked the Secretary of State for Trade when he expects to be able to make a full statement on the first report of the Interim Action Committee on the Film Industry.

Mr. Meacher: As soon as I have completed the necessary consultations and consideration.

Mr. Jenkins: In holding those consultations and making those considerations, may I ask my hon. Friend to take into full consideration the proposals he has received and is to receive from the Interim Action Committee? Will he also consider the possibility that he might take some useful action in relation to the British film industry without waiting for legislation?

Mr. Meacher: We shall certainly be undertaking the consultations on the basis of the Interim Action Committee's report. My hon. Friend can rest assured that


there are a number of issues, in particular the publication of more information about the Eady returns, which I am considering and which, I think, will give interim aid to the film industry.

Heathrow Airport

Mr. Jessel: asked the Secretary of State for Trade whether he expects his Department to give evidence to the forthcoming planning inquiry into the proposal for a fourth terminal at Heathrow Airport.

Mr. Clinton Davis: My Department is prepared to give evidence if the inspector conducting the public inquiry thinks that this will be helpful.

Mr. Jessel: The Secretary of State for Trade has said:
Our policy … envisages the provision of a fourth terminal at Heathrow."—[Official Report, 1st February 1978; Vol. 943, c. 456.]
Therefore, how can those members of the public who live around Heathrow and who suffer from aircraft noise have any confidence in the impartiality of the Government's decision following the planning inquiry?

Mr. Davis: The planning inquiry is in the hands of Mr. Iain Glidewell, a Queen's Counsel of considerable repute—

Mr. Adley: A legal high flier.

Mr. Davis: —and whose name, in relation to aircraft noise, is wholly appropriate.

Mr. Hugh Jenkins: Will my hon. Friend consider whether the Government are not simply holding inquiries as a preliminary to making public decisions which they have already reached? In the case of Windscale, as well as Heathrow, is it not a fact that the Government have already made up their mind what to do and the inquiries are merely facades?

Mr. Davis: My hon. Friend is not exactly disinterested on this subject, as he has revealed on a number of occasions.

Mr. Cormack: Neither is the hon. Gentleman.

Mr. Davis: The Government have set out their point of view in the White Paper. The matter will be considered by

the inspector in the course of his investigation. It is a matter of evidence which no doubt he will find—I hope—persuasive. It is not a matter which he need find absolutely compelling. If my hon. Friend feels as strongly as he suggests on these matters, he must pay attention to the scope of the inquiry and may have to consider whether he wishes to give evidence.

Government Policy

Mr. Forman: asked the Secretary of State for Trade whether he will make a statement on the Government's trade policy.

Mr. Tim Renton: asked the Secretary of State for Trade what steps he is taking to increase Great Britain's share of world trade against a background of increasing world protectionism.

Mr. Meacher: Our policy is to widen trade opportunities while firmly resisting unfair practices of others, and to support the efforts of all our exporters.

Mr. Forman: Does the Under-Secretary accept that if and when the present recession passes there will still remain a serious problem for this country posed by the so-caller super-competitive countries? What is his Department prepared to do about this, particularly in relation to pressing our EEC partners to liberalise procurement policies so as to increase the volume of our market and thereby encourage British firms to trade up so that they can move more and more into capital goods and high technology sectors, as the Germans have so successfully done?

Mr. Meacher: I accept that those are sensible policies. They are certainly policies which, with appropriate aid from the BOTB, we are encouraging our companies to abide by. We are also concerned, with regard to the super-competitive and developing countries, with the prohibitively high tariffs which they still retain, although they are not among the poorest of developing countries. We are using our position within the EEC to press those countries to reduce tariffs and to accept the international rules of GATT a great deal more.

Mr. Renton: Does the Minister agree that it is impossible to achieve full employment in a closed economy because of our interdependence upon each other?


Why, then, is the Secretary of State for Trade reported as approving selective safeguards for GATT? Is that not a dangerous move towards protectionism, and does it not mean that we now intend to kick hardest against those who offer our consumers the best bargain?

Mr. Meacher: The problem with the hon. Gentleman's diagnosis is that he does not seem to have noticed that full employment is not compatible with an open trading system either. Although the Government have made strenuous efforts to maintain the openness of the world trading system, unemployment has continued to rise. The purpose of the selective safeguards is precisely to preserve intact the basic structure while taking action against a few countries, which can be highly disruptive of business opportunities and levels of jobs in many other countries.

Mr. John Ellis: Will my hon. Friend now take the bull by the horns and recommend to his colleagues that we ought to have selective import controls? Is this not yet one more respect in which we cannot look after the interests of our own nation because of our involvement with the Common Market?

Mr. Meacher: Perhaps my hon. Friend has not noticed that we already have selective import controls in quite a few sectors. These include textiles and footwear, as well as, increasingly, the arrangements being made about world trade in steel, to some extent in shipbuilding and to a degree also in consumer electronics; moreover, one-third of ah1 our imports from Japan are now subject to the voluntary restraint agreement. There has been a substantial increase in selective import controls.

Mr. Parkinson: Will the Minister confirm that Britain's exports represent 27 per cent, of gross national product, and that Japan's represent 13 per cent, and America's only 8 per cent., so that we are twice as dependent as the Japanese on exports and three times as dependent as the Americans? Will the hon. Gentleman tell his hon. Friends that we have a great deal to lose if we spark off protectionism?

Mr. Meacher: I cannot confirm those figures, though they sound about right. But what the hon. Gentleman does not seem to have noticed is that there has

also been an extremely sharp increase in the rate of imports, so that the marginal propensity of this country to import manufactures is around 50 per cent., and this constitutes a real problem.

Japanese Motor Vehicles

Mr. Hal Miller: asked the Secretary of State for Trade whether the British Ambassador to Japan obtained satisfactory assurances from the Japanese Government about Japanese exports of motor vehicles to the United Kingdom in 1978.

Mr. Biffen: asked the Secretary of State for Trade what representations he has received requesting import controls on Japanese motor cars; and if he will make a statement.

Mr. Edwin Wainwright: asked the Secretary of State for Trade, in view of the number of cars imported to the United Kingdom during the past four years, including many Japanese, what representations he has received on action to safeguard the home market.

Mr. John Evans: asked the Secretary of State for Trade what recent representations he has had concerning the level of imports of cars from Japan.

Mr. Robinson: asked the Secretary of State for Trade if he will make a statement giving the details of the terms of any agreement reached with the Government of Japan for the limitation of imports into the United Kingdom of motor vehicles.

Mr. Meacher: I have received a number of representations from hon. Members and others about vehicle imports from Japan. The Japanese Government have clarified the Japanese industry's intentions for the present year in a letter, the text of which was reproduced in the Official Report on 7th March.

Mr. Miller: Are those arrangements due to Japan's super-competitive and rigged economy, or is the purpose to provide for British production supported by public investment? If the latter is the case, are there any arrangements made should British production not reach the


hoped-for level and should other countries take Japan's share of the market?

Mr. Meacher: I think that the reason why the Japanese are so successful in their car exports is well understood. It is based on a high level of capital investment, the most modern equipment, very good labour relations and, by and large, I think, good management. All these are objectives which it is perfectly possible for other countries to meet, and in the transformation of British Leyland we certainly intend increasingly to bring those conditions about. Checks on the import of cars into Japan is a special problem pertaining to that country.

Mr. Biffen: Is the Minister aware that Datsun has provided an automatic Cherry model fitted with hand controls which is now being evaluated by the West Midlands Disabled Motorists' Club? Is he further aware that there are signs that this may prove to be an extremely valuable vehicle for disabled motorists? Can he therefore give an undertaking that in the implementation of voluntary import controls on cars no action will be taken to the disadvantage of this model should it prove advantageous for disabled motorists?

Mr. Meacher: This is the first time that that matter has been brought to my notice. We are most concerned to ensure that our objectives regarding the import of passenger cars from Japan are met, and I believe that the Japanese understand that very well. Even with the social purpose which the hon. Gentleman has in mind, I should be very concerned if those targets were to be breached. However, compatible with the maintenance of those targets, I shall seek to ensure that there is no restraint.

Mr. Hoyle: What has happened to the great sales drive for the Japanese to buy British components for their cars? It does not seem to have got off the ground. Does this not point to the need carefully to monitor the new agreement with the Japanese Government and take action if it is found that they are exceeding the agreed total of cars exported to this country?

Mr. Meacher: We are most concerned about the level of car component exports to Japan. We sell about £12 million

worth of car components to Japan and about £1,000 million worth to the EEC, so it is not as though the British industry is not highly competitive. The British industry is also making a major drive through the British Export Marketing Centre in Tokyo and at the Tokyo Motor Show. We shall be monitoring all these matters to see whether there is any increase in these exports to Japan, and we shall be reviewing the situation closely with the Japanese.

Mr. Higgins: Why did not the Secretary of State make an oral statement to the House when this arrangement was first made and submit himself to questioning? Does the Under-Secretary of State agree that this latest arrangement is a restrictive practice, restricting imports in the same way as tariffs or any other barrier does, and must it not have a serious effect both on competition and on consumers? Does the hon. Gentleman agree that what this country needs is not more protectionism but more production?

Mr. Meacher: The purpose of Questions is for Ministers to submit themselves to questions from hon. Members—as they are now—on the activities of their Departments since the last date for Oral Questions. The very full answer which my right hon. Friend gave to the House is, I am sure, perfectly adequate.
As regards the level of imports, I suggest that the hon. Gentleman must make up his mind whether he wishes to see a prosperous and viable British motor vehicle industry, and, if he does, whether there are alternative measures to those which we have adopted to achieve that aim. Certainly we need a higher level of production, and there is evidence that British Leyland is substantially increasing its production. I think that that means not only better labour relations but also management increasing its production targets.

Mr. Wainwright: Does my hon. Friend agree that we must not allow imports of cars to destroy our home industry but this nevertheless depends on our competitive standards? What sort of investment is going into our motor car industry to bring it up to international standards, and what discussions is my hon. Friend having with the management and work force to ensure that


we get the best out of what we now have?

Mr. Meacher: I am sure that my hon. Friend knows that my right hon. Friend the Secretary of State for Industry recently announced a further substantial injection of money into British Leyland. Under the new management, there are exhaustive discussions on the question of improved labour relations and the meeting of output targets.

Mr. Nott: At the heart of this problem does there not lie the fact that the British motor industry is not at present producing what the British consumer wishes to buy, and if, by means of self-restraint or other methods, there is a restriction on Japanese imports into Britain, we shall probably have more Italian and German imports which will fill the gap? Also, is it not a fact that the British motor vehicle component industry and commercial vehicle industry had a net surplus last year on the balance of payments of £1,300 million—a massive surplus—and ought we not to look to our successes in this area rather than our failures, being concerned that protectionist measures shall not damage what is, in global terms, a highly successful British industry?

Mr. Meacher: Again, I suggest that the hon. Gentleman must make up his mind whether it is Conservative Party policy to allow imports untrammelled and without restriction and to take into account the likely short-term consequences of that. As the hon. Gentleman knows, we received representations from British Leyland, under its new chairman, asking for restraint on Japanese imports, precisely because the increase in imports from the EEC, of which there is indeed a danger, cannot be stopped under the Treaty of Rome. We took what action could be taken to preserve the extra production for the British industry, and we intend to ensure that that extra production is forthcoming.
As regards the surplus in respect of motor car products, I am sure that the hon. Gentleman will have noted that, although we still have a surplus, it has been rapidly declining in recent years. Again, we have to ensure a successful base for our motor car production.

Japan (Exports)

Mr. Ronald Atkins: asked the Secretary of State for Trade what representations he has received complaining of artificial impediments to British exports to Japan.

Mr. Meacher: Representations have been received on a number of specific obstacles to exporting to Japan. We have made progress in modifying some of these such as vehicle emission standards and testing arrangements.

Mr. Atkins: Does my hon. Friend agree that Japan built up her industrial strength with the aid of protection and is using that strength to destroy British industries? In Ireland she is now preparing to flood the British market with commercial road vehicles. Will my right hon. Friend take action to protect many thousands of jobs in central Lancashire?

Mr. Meacher: My hon. Friend is right—and Conservative Members might take note of this—in saying that the Japanese built up their formidable export success on the basis of the absence of liberalisation and very high tariff protection in the 1950s and 1960s.
As regards the production of heavy commercial vehicles in Ireland, we have received an assurance from MITI that there will be no heavy commercial vehicles exported from Japan this year. We are aware of the operation in Ireland. There is no significant number of registrations of those vehicles in England, but we shall certainly be watching the situation very closely and reviewing it with the Japanese on a number of occasions this year.

Mr. Powell: Are the Government aware that the principal artificial impediments to British trade with Japan or any where else are, first, the rigging of the exchange rate of the yen and other currencies, and, secondly, the restrictions sought to be placed upon imports into this country?

Mr. Meacher: "The rigging of the exchange rate" is, as always from the right hon. Gentleman, a highly colourful phrase. Pressure has properly been put on the Japanese by the EEC, including ourselves, and by the Americans to ensure


an exchange rate which is more realistic in terms of export levels. The export surplus of the Japanese reached $11 billion in 1977, and unless there were changes in the exchange rate the Japanese could not possibly succeed in their stated target of an export surplus of $6 billion in the current year.
As regards import restrictions, we have stated regularly that our aim is freedom for imports into this country, provided that is matched by freedom for our exports into the other country. In the case of Japan, that is not at present realised.

Mr. MacFarquhar: Does my hon. Friend agree that one of the reasons for the problem about Japanese car imports into this country is that we play by the rules and some of our Common Market partners do not? Therefore, in order to help to avoid a trade war, will my hon. Friend undertake to investigate whether there are impediments upon Japanese car exports to France and Italy which do not exist in this country and try to make them remove those impediments?

Mr. Meacher: Certainly, the level of Japanese car imports into Italy is extremely low, almost negligible, precisely because there was a pre-existing restraint prior to accession to GATT. I am aware that the level of Japanese car imports into France is about 3 per cent, compared with our figure of about 10 per cent, or 10½ per cent. Of course, it is much easier to hold the position that one has reached than it is to roll back, but we are prepared to take lessons from the French, if my hon. Friend can advise me.

Mr. William Shelton: In view of the mood of protectionism which seems to be sweeping across the Government Front Bench today, is the Under-Secretary aware that every limitation of imports is a limitation of consumer choice in this country? Does the hon. Gentleman agree with the recently expressed fears of the Prime Minister about protectionism in the world and the damage it would do to this country?

Mr. Litterick: How much choice do the unemployed have?

Mr. Meacher: There is also a lack of consumer choice if British industry is

whittled down to the point where it is no longer viable. It is our concern to ensure that for all major products the British consumer will continue to have a good British choice.

Biggin Hill Airport

Mr. John Hunt: asked the Secretary of State for Trade what recent communication he has had with the London Borough of Bromley with regard to the future use of Biggin Hill Airport.

Mr. Clinton Davis: My Department is in touch with Bromley Borough Council about various matters concerning Biggin Hill Airport. Following the publication of the White Paper on airports policy, my officials will now be approaching the council to discuss the airport's future.

Mr. Hunt: Is it not a fact that in its recent letter to the Secretary of State Bromley Borough Council made it clear that it wanted to keep control of the airport and was totally opposed to the proposals in the White Paper? As the British Airports Authority has gone on record as saying that it would want to take over the airport only if the council wished, what is the point of the further discussions that the Under-Secretary has now mentioned? Does that not dispose of the matter?

Mr. Davis: I do not think that it does, because these are still very early days after publication of the White Paper, which was only on 1st February. I think that it is right that all relevant aspects should be explored by the council and the BAA before a final judgment is made. That is not to say that the BAA will impose its view. It cannot. But the council is right to point out that the Civil Aviation Authority and the Standing Conference on London and South-East Regional Planning supported its idea.

Mr. Tim Renton: Does the Under-secretary accept that there is a general over-weighting in the White Paper in favour of airport development in the South-East—

Mr. Speaker: The hon. Gentleman is widening the Question. It is about Biggin Hill.

Mr. Renton: With respect, Mr. Speaker, Biggin Hill is only about 15 miles from Gatwick as the crow flies, and


they are both covered by the South-East airports policy. I therefore repeat my question to the Under-Secretary about the over-weighting on the South-East airports in the White Paper.

Mr. Davis: I do not think that the Question has anything to do with crows flying.

Copyright Law

Mr. Arnold: asked the Secretary of State for Trade when he expects to complete his consultations on the Whitford Committee Report on the law of copyright.

Mr. Clinton Davis: My Department invited all those who gave evidence to the Whitford Committee to submit their views on its recommendations by the end of 1977. Although more than 100 have responded, some important organisations have asked for more time. I have agreed since the issues dealt with in the report are complex. Nevertheless, I hope to complete our consultations in the near future.

Mr. Arnold: Will the hon. Gentleman confirm that amendment of copyright law will now need to take account of our membership of the European Community? As the European Court has already handed down rulings on a number of neighbouring rights, trade marks and patents, will the hon. Gentleman indicate whether the process of consultation will include the Commission and other member countries?

Mr. Davis: I think that we are a long way from coming to a view about the recommendations in the report. In any event, there is not unanimity. Consultations on the basis of the report are still not complete. As for the EEC, Dr. Dietz has submitted proposals which have not yet even been translated into English. These are matters that will require full consideration, and consultation will certainly take place with interested organisations.

Balance of Trade

Mr. Neubert: asked the Secretary of State for Trade what is his revised estimate of the balance of trade in 1978; and whether he will make a statement.

Mr. Meacher: I would expect there to be a further significant improvement

in our visible balance in 1978, following the improvement of £1,900 million in 1977.

Mr. Neubert: But do not the recently revised figures for the last quarter of 1977 indicate a danger of our taking for granted our invisible earnings, particularly from tourism? Does the hon. Gentleman agree that a tourist tax would be likely to discourage earnings from that source?

Mr. Meacher: I am concerned about the drop—a small drop—in the level of increase of our tourism earnings in the fourth quarter of 1977. The hon. Gentleman referred to a tourism tax. No Government spokesman has suggested that there is likely to be such a special tax, especially as tourists from overseas already spend an estimated £100 million a year in VAT, tobacco and liquor.

Mr. Terry Walker: Does my hon. Friend recall that last week I raised with the Department a matter raised with me by a company in my constituency which had £340,000 worth of exports held back in the Mersey because two ships were unloading cars from Japan? That is an example of exports being held back because of exports from countries such as Japan.

Mr. Meacher: My hon. Friend may be right in the case that he mentions, but it is a matter for the management of the docks rather than for a change in Government policy.

Mr. Nott: Is the Under-Secretary aware that, in the absence of his right hon. Friend the Secretary of State, this Question Time has been about protectionism and very little else? The hon. Gentleman said earlier—I do not know whether he is aware of this—"Full employment is not compatible with an open trading system."

Mr. Rooker: He did not.

Mr. Nott: That is precisely what the Minister said. He will have a chance to correct it. Does the Minister think that full employment is compatible with an increasingly protectionist trading system? We want to know which side the Department of Trade is on.

Mr. Meacher: We certainly know which side the Conservative Party is on.


It is for an untrammelled increase in imports irrespective of the consequences for British industry. All that the Government have said is that we need a balance between complete openness and protectionism which will maximise the benefits for the United Kingdom, which includes benefits for foreign exporters to us.

Japanese Imports

Mr. Litterick: asked the Secretary of State for Trade if he will now take unilateral action to restrict the importation of Japanese manufactured goods into the United Kingdom.

Mr. Meacher: Voluntary arrangements already cover about a third of our imports from Japan, including all the most sensitive sectors.

Mr. Litterick: Will my hon. Friend accept that there wil be great disappointment in Birmingham that the Secretary of State is still content to trust the Japanese and that a continuation of the present policy will merely mean that the Selly Oak labour exchange will become overcrowded? Will he accept a piece of advice and take it on board, namely, that he should bring forward a regulation insisting that all Japanese cars imported into this country satisfy the same technical conditions which they have to satisfy in Japan vis-à-vis environmental pollution?

Mr. Meacher: With regard to trusting the Japanese, they know that my right hon. Friend agreed to forgo certain more formal controls only if they made a clear commitment to restrain their vehicle exports to us in a manner acceptable to us. That is how the matter stands. If the Japanese do not keep to their side of the bargain—although I expect that they will—we are under no obligation to do so.
I appreciate the point my hon. Friend makes about non-tariff barriers. We are concerned about the reduction of non-tariff barriers in Japan and we are using the multilateral trade negotiations to achieve an improvement. But pollution in Japan is noticeably more damaging to health than it is in the United Kingdom.

Mr. Dykes: Does the Minister agree that the best way of getting the Japanese to co-operate fully is not through unilateral negotiations but by negotiation through the EEC, as he himself said

earlier when he referred to negotiating pressure?

Mr. Meacher: Certainly the opportunity of gaining an improvement in the situation with the Japanese is aided by the fact that the United Kingdom is negotiating through the EEC, provided, of course, that we can get the agreement of other member States in the first place, which is by no means always the case. But a stronger trading bloc carries greater weight with the Japanese.

Mr. Park: Will my hon. Friend say what steps he is taking to monitor this understanding during the course of the year; or will he wait until the year ends and then, if it goes wrong, try to do something about it? With regard to a Japanese vehicle for disabled people—a point made by the hon. Member for Oswestry (Mr. Biffen)—will my hon. Friend draw to the Secretary of State's attention the fact that GKN has made a prototype vehicle? I should have thought that charity began at home.

Mr. Meacher: I shall look into the general position with regard to vehicles for the disabled, and I shall write to both my hon. Friend and the hon. Member for Oswestry (Mr. Biffen). It is part of the agreement—this was stated by my right hon. Friend on 7th March—that there will be regular reviews to monitor the progress of shipments in relation to the development of the United Kingdom market. We shall therefore have a full opportunity in the early, middle and later parts of the year to see how the level of Japanese shipments is developing with regard to the objectives that we mean to see fulfilled.

Mr. Parkinson: Has the Minister tried to buy a British Leyland car recently? May I tell him that I have—last week—and was quoted four months to six months delivery for the model that I wanted? [HON. MEMBERS: "Which model?"] The model that I wanted. I am proud to declare my interest. It was a Jaguar. [HON. MEMBERS: "Ah."] I am trying to keep up with Ministers and their chauffeur-driven cars. Does the Minister agree that unless we are very careful, and if he listens to his hon. Friends, British taxpayers will find themselves pumping hundreds of millions of pounds into British Leyland and yet be


unable to buy a car? I am sure that the Minister would agree that that would be ridiculous.

Mr. Meacher: The alternative side of the coin is that if we do not pump several hundred millions of pounds into capital investment in British Leyland—which that company has needed for decades, particularly with regard to the production of Range Rovers and Land Rovers which are important to exports—no one will be able to buy a British car anyway. Clearly we must do a great deal more than impose restrictions on imports, but unless we have that degree of protection I do not believe that it is possible for the British car industry to survive.

CHURCH COMMISSIONERS (FINANCE)

Mr. Ryman: 39. Mr. Ryman asked the hon. Member for Kingswood, as representing the Church Commissioners, what was the value of the total assets and income of the Church Commissioners during the last three financial years.

Mr. Terry Walker (Second Church Estates Commissioner): In 1974–75 the Commissioners' assets were valued at £498 million and their total income amounted to £33·1 million. The comparable figures for 1975–76 and 1976–77 were £620·6 million and £37·2 million and £676·2 million and £42·3 million respectively.

Mr. Ryman: I thank my hon. Friend for that illuminating reply. May I ask him to deal with the following points? Is he aware of the crisis within the Church and the widespread extent of real poverty among members of the clergy today? Is he aware that there are fewer clergy doing more and more work—

Mr. Speaker: Order. The hon. Gentleman seems anxious to impart more information than he is seeking. If he will ask his question he will get an answer and perhaps we shall get in another Question as well.

Mr. Ryman: May I ask my hon. Friend why the administration of funds by the Church Commissioners is negligent in producing such a small income which causes real poverty among the clergy when many other organisations, such as pension funds, with a comparative capital

position, can produce a far higher rate of income?

Mr. Walker: I am pleased to help my hon. Friend. The policy of the Church Commissioners, which has now been announced, and which conforms to the Government's policy of 10 per cent., will mean that the minimum range for incumbents next year will be between £2,900 and £3,250 and £2,100 and £2,580 for curates. That is a significant increase and one which, I am sure, my hon. Friend will feel is helpful to the clergy whom we recognise are in desperate need.

Sir David Renton: Is the hon. Gentleman aware that the demands upon the resources of the Church Commissioners in recent years have been greatly increased by the extra number of clergy needed because of the larger population? Have not demands also increased because of inflation? Can the hon. Gentleman say what proposals the Church Commissioners have, if necessary to put before Parliament, in order to overcome those two difficulties?

Mr. Walker: Certainly the level of giving on behalf of the diocese has been most encouraging. That has definitely helped the Church Commissioners to raise the stipend level as much as possible. Over the last few years we have been held back by various incomes policies. That is why clergy stipends have not increased as much as we would like.

Mr. Clemitson: Will my hon. Friend raise with the Church Commissioners the possibility—which I have raised before with the First Church Estates Commissioner—of the Commissioners making at least a small amount of their funds available for the development of co-operatives?

Mr. Walker: We have taken that on board and will consider it for the future.

HOSPITAL TELEPHONISTS (INDUSTRIAL ACTION)

Dr. Vaughan: Dr. Vaughan (by Private Notice) asked the Secretary of State for Social Services whether he will make a statement about the steps he is taking to avoid risk to patients consequent on the industrial action of National Health Service hospital telephonists.

The Under-Secretary of Slate for Health and Social Security (Mr Eric Deakins): I understand that unofficial industrial action has been taken by some hospital telephonists who are dissatisfied with their recent pay settlement within the guidelines. Both my right hon. Friend the Secretary of State for Social Services and I deprecate action of this kind, which may adversely affect services to patients. It is for health authorities, in consultation with my Department, to deal with the effects of industrial action and safeguard the interests of patients.

Dr. Vaughan: That statement will be regarded as totally inadequate by many people. Also, the absence of the Secretary of State will be taken as further evidence of the lack of leadership on the Government side in the National Health Service field.
Will the Minister tell the Secretary of State that widespread industrial action of various kinds is taking place in the Health Service today, and that this is having an extremely serious effect on the morale and care of patients? Will he also ask him to answer the question that I put to him last week on why he condemned the dentists and the doctors but has not condemned the porters at Dulwich, Westminster and Southampton, and has not openly condemned the telephonists?
Will he categorically condemn strike action in the National Health Service and make it clear to these people that when they work in the care of patients they give up some of their freedom to take industrial action? There is no place in the health field for industrial action of this kind, which affects the care of patients. Will the Secretary of State call a meeting between the health professions and the TUC with a view to outlawing action of this kind?

Mr. Deakins: I do not know the rules about asking supplementary questions on a Private Notice Question, but I was under the impression that this Question was about hospital telephonists and not about porters, doctors or dentists.
As far as the telephonists are concerned—this is the subject of the Private Notice Question, and if the hon. Gentleman had wanted to put down a Question about doctors, dentists or porters he could have done so—the facts of the matter are that

I am responsible within the Department for industrial relations affecting all groups of staff, other than doctors and dentists, who are the responsibility of the Minister of State for Health.
Both the Secretary of State and the Prime Minister have condemned this industrial action unreservedly because it might result in cutting off communications between hospitals and the outside world. Some telephonists claim that they are working to rule when they are in fact censoring telephone traffic within the hospitals. I wish to make it absolutely clear that there is no such rule—and I am glad of the opportunity to do so—not only to the hospital telephonists but to the hospital managements.

Mr. Faulds: Would my right hon. Friend not agree that many of us on this side of the House find industrial action that affects the interests of patients, whether it is taken by doctors or hospital staff, as demeaningly selfish, un-Christian and unacceptable?

Mr. Deakins: These views would be widely shared in my Department. What we are seeking to do is to bring all sides together in this, the 30th anniversary year of the National Health Service, in order to see whether we can sort out these problems for the future.

Mr. Hooson: I, too, regard this action as reprehensible, as is all industrial action in the health sphere. Will the Minister say whether he has had direct talks with the unions with a view to calling off this particular form of industrial action because of the danger to patients?

Mr. Deakins: This is a complex industrial dispute, and the Floor of the House of Commons is not the place for resolving complex industrial disputes. This is not just a straight case of workers versus management. I met hospital telephonists from the constituency of my hon. Friend the Member for Southampton, Test (Mr. Gould) recently and they declared their dissatisfaction and disillusion with the whole system of the existing channels for remedying their grievances. These channels are the Whitley Council system, and action is being taken in the appropriate Whitley Council between management and unions to try to come to an amicable solution.

Several Hon. Members: Several Hon. Members rose—

Mr. Speaker: Order. This is a Private Notice Question and I cannot allow it to run on. I shall call one more hon. Member from either side.

Mr. Skinner: Is the Minister aware that in every strike or industrial action, official or unofficial, it needs two sides to bring about the action and to create the reaction by the other side? Is he also aware that the single biggest cause of disruption in the NHS in the past few years has been the massive cuts in public expenditure that have been imposed and are still being imposed by the Minister and his Government, aided and abetted by hon. Members opposite who have put down the Question?

Mr. Deakins: This particular disruption stems mainly from dissatisfaction on the part of some with the grading system whereby there are no direct comparisons with the pay of telephonists employed outside, such as those in the Post Office. These are difficult questions to deal with and I do not see any easy solution to that grievance.

Mr. Tebbit: Since we are all agreed on this, except the Beast of Bolsover who turns out to be a fossilised dragon fly—

Mr. Speaker: Order. The hon. Member knows that, whatever is said outside here, we must use parliamentary language inside the Chamber.

Mr. Tebbit: I did not think that there was anything unparliamentary in what I said. If there was, no doubt you will guide me, Mr. Speaker.

Mr. Speaker: I thought that I heard the hon. Member use an expression which I have read in the Press but which I have never heard used in the House.

Mr. Skinner: The hon. Member can say what he likes.

Mr. Speaker: Order. That is a terrible invitation.

Mr. Skinner: Let him get on with it.

Mr. Speaker: The hon. Member for Chingford (Mr. Tebbit) will withdraw his expression.

Mr. Tebit: Certainly I will withdraw the expression. I shall not repeat anything that you rule as unparliamentary, Mr. Speaker.
Since we are all agreed, with one exception, that we should deplore this sort of action in the Health Service, will the Minister tell us what he will do to ensure that those who are taking this action and risking the lives of patients are brought to book and have to suffer some disadvantage, preferably in their career structure or reward, in order to make sure that others do not follow their example?

Mr. Deakins: That is a matter for the health authorities and not for Ministers. The health authorities must deal with the adverse consequences of this industrial action. If Parliament had wanted Ministers to control the day-to-day management of the NHS, it should have taken different decisions when the Health Service was being reorganised by the Conservatives in 1973. The health authorities must deal with this, and I am sure that they will take action to safeguard the interests of their patients.

BILL PRESENTED

ROAD ACCIDENT (COMPENSATION)

Mr. Graham Page, presented a Bill to make provision for recovery (without proof of fault) of compensation for injury resulting from the use of a motor vehicle on a road and to require compulsory insurance in respect thereof; and for purposes in connection therewith; And the same was read the First time; and ordered to be read a Second time upon 21st April and to be printed [Bill 82.]

SELECT COMMITTEE (COMPLAINT OF PRIVILEGE)

3.40p.m.

Mr. Frederick Willey: I beg to call attention to the reports published in The Guardian newspaper and the Daily Mail newspaper on 8th March 1978 relating to the proceedings of the Select Committee on Race Relations and Immigration, and to move,
That the matter be referred to the Committee of Privileges.
I am sure the House is greatly obliged for the careful consideration which you, Mr. Speaker, have given to the submission I made. In view of your ruling on Friday, I move this motion formally.

3.41p.m.

Mr. J. W. Rooker: I wish to oppose the motion. I am surprised that it was expected to go through virtually on the nod.
Let me give my reasons for opposing the motion. I was responsible for raising a matter of privilege in 1975 concerning The Economist. As I said in the debate on 16th December 1977 when we debated the Report of the Committee of Privileges, I then deeply regretted, and still do, the fact that I had raised the matter of privilege in the first place.
I disagree with the rules that are being used, and for those reasons I disagree with the conclusions reached by the Privileges Committee. I say this on the grounds that any journalist worth that title will never divulge his sources of information. I do not see what my right hon. Friend the Member for Sunderland, North (Mr. Willey) expects to gain by referring this matter to the Committee. It can only come back to this House with a report based on the information that is before it, for nobody will tell the Committee who committed the so-called breach of privilege or who gave the journalist the information in the first place.
I submit that it does this House no good whatever to go through this charade once again and attempt to bring journalists, who are only doing their job, to book when the real culprits are those who acted against the reports of Select Committees of this House. We shall not be able to find those people by means of this procedure. Therefore, it is a charade

and a total waste of time to go through this whole process. At a later date when we have debated the report of the Privileges Committee I do not think we should then go through the whole procedure of the journalist concerned doing penance by coming to the Bar of the House, or being put in the custody of the Serjeant at Arms. After the experience on the last occasion, I am sure that the House will not wish to support such a recommendation. On those grounds I oppose the motion.

3.44 p.m.

Mr. Dennis Skinner: I believe that it would make no sense for this matter to be referred to the Privileges Committee, and I say this for a number of reasons.
The first thing that happens when these matters go before that Committee is that it tries to find every possible way round the subject in order to avoid conflict at the end. I well recall the occasion when Arthur Scargill was alleged to have influenced some of the sponsored Members of Parliament who had voted in favour of the Common Market because that vote went against a ban in the area committee. The Privileges Committee spent a great deal of time trying to find ways not to bring Arthur Scargill to the Bar of the House. I have no doubt that if Arthur Scargill had got to the Bar of the House, he would have relished it. I do not know that I can speak for Arthur Scargill—and he cannot speak for me either, and he knows it.
The point was that the Committee sat several times, and letters were sent to officials of the union—and not only to Arthur Scargill but to Joe Gormley—to try to clarify the situation in order to avoid a head-on clash. My guess is that if this matter goes any further, it will finish up in exactly the same way. Therefore, this matter is a nonsense as well.
The subject was raised in The Sunday Times at a time when my right hon. Friend the Member for Sunderland, North (Mr. Willey) was not in a position to raise the matter with you, Mr. Speaker. One does not know why he did not have that opportunity. Perhaps he does not read The Sunday Times. Perhaps eventually somebody bumped into him in the corridor and said, "Hi, Fred, have you seen The Sunday Times?", and no doubt


added that the matter should go before the Privileges Committee. The result is that this matter is going before the Committee in relation to certain newspapers when the newspapers who first reported it are not involved.
I do not like the idea of Select Committees anyway. I think the way they conduct their business, mainly in private, is a nonsense. For that reason, too, I do not think the matter should be referred to the Committee.
Recently we had all the fuss about the report of the Select Committee that dealt with the British Steel Corporation. Most of that was mentioned in the Press beforehand, but for some reason or other that did not merit the attention of reference to Mr. Speaker to pass on to the appropriate Committee.
I hope that the House will take all these matters into account before it votes today, because I believe that this is yet another motion that should not be sent upstairs. We should forget all about it. It is not worth the paper it is written on. When eventually, if the motion is approved, the matter comes back to the House for debate, it will involve recommendations that mean all things to all men and all women. It will have wasted the time of the Members involved. I suggest to those Members—not that they matter much to me—that they should save their time.

3.47 p.m.

Mr. Ivan Lawrence: I should like to ask the right hon. Member for Sunderland, North (Mr. Willey) two questions which are very relevant to this matter.
First, is it not the latest Privileges Committee ruling that there has to be substantial interference with the deliberations of a Committee? If the position is that after the deliberations had been completed the matter was leaked before the printers printed it, where is the substantial interference with deliberations? Is that all that is being complained of?
Secondly, is it not a fact that a week before the breaches complained of in this motion the Sun and The Sunday Times, and I think The Guardian also, gave some account of the findings of the Select Committee? If so, were they substantially interfering with any delibera-

tions? If so, are they not more to blame than those concerned in what has since happened as the subject matter of this complaint? It seems to me that if the answer to that question is "Yes" and that these newspapers were more to blame, and that there was no substantial interference with the consideration of the Select Committee from the Mail and The Guardian on the occasions complained of, we are wasting our time suggesting that this matter should go before the Privileges Committee. Those whom we represent in the country will see once again that we in this place are only protecting our own tender susceptibilities and are wasting a good deal of time and public money.

3.48 p.m.

Mr. John Mendelson: In several earlier Parliaments, not under the present Government but when the present Lord President of the Council was an active Back Bencher, there was a series of cases following which it was beginning to be established that the process of referring matters to the Privileges Committee should not be activated without due consideration. My right hon. Friend was most punctilious that that should be the case at the time. I think that he was right, and there will be a number of Members now present in the Chamber who will remember those debates.
On one occasion my right hon. Friend the Prime Minister was at the other end of the argument. He was only doing his duty, because certain Officers, such as you yourself, Mr. Speaker, have certain formal functions to perform which amount almost to a ritual, but the House itself is under no such compulsion. It is unhealthy that this power, which is so greatly misunderstood in the country, and for good reason, should be applied automatically on every occasion.
I believe that my hon. Friends the Members for Bolsover (Mr. Skinner) and Birmingham, Perry Barr (Mr. Rooker) are right to raise this point. However, I should like to go further and call on hon. Members to oppose this motion. First, I submit that there should be a debate and secondly, that the House should reject the motion.
At present a great many things are taking place in Select Committees which are being given a great deal of space in


the Press and are being discussed on television and radio. There are a number of people—I am not one of them—both in Parliament and in the Press who demand that the powers of Select Committees should be extended. This trend may well prove to be irresistible. I hope that will not be the case, but it is possible. If that is to be the case, we shall enter a new period in which the results of our discussions and review will become even more important.
If there is a tendency for Select Committees to increase the circumference of their work—for example, if they are to be concerned particularly with matters not of accountancy rectitude in the past but of current controversy—the argument for allowing them to work in secret becomes very thin. Indeed, in my submission, it disappears altogether.
The advocates of the extension of the Select Committee system always quote as a shining example the United States Congress. Whether it be a shining example or not, the people who want an extension of powers and activities always quote Congress. It is well known in this House that only on selected occasions are Select Committees of the United States Congress entitled to go into what is called executive session. In principle, as my hon. Friend the Member for Feltham and Heston (Mr. Kerr), the Chairman of the Select Committee on Nationalised Industries, will confirm, normally and traditionally their work has to be carried out in public and they need a special motion to be passed to enable them to sit in secret. Indeed, together with other Members of this House, I was present on a number of occasions in Congress when such a motion had to be passed and it was not always uncontested, even among the Members of the Committee. Therefore, if we are to look for an extension of the work of Select Committees, we must also look at the conditions that obtain in other Parliaments where that extension has already taken place.
If Select Committees are to deal with matters of great current controversy, I think that it is dangerous to exclude the public. I believe that the public ought to be allowed in on those discussions.
In this respect I add one important point—the danger to the standing of individuals. That is a matter about which

the House is always concerned. Why should it be kept secret that an officer of the Crown, a Minister, a civil servant, the chairman of a nationalised industry or, indeed, any humble servant of any public authority has been severely criticised? Why should we have to wait for months before anyone can say anything in his defence?
As long as Select Committees do not take it upon themselves to assume such functions, there might be a good argument for secrecy. I do not intend to rehearse the argument, but the origins of secrecy have nothing to do with any of these matters. They are to be seen in the suspicion by Members of the House of Commons that their privileges might be interfered with if ordinary citizens knew what they were about. Surely that concept can have no place in our attitude today.
I understand that the rule has been applied in the past, but I think that anyone moving such a motion as this should be under an obligation to justify it. We should establish this by case law and by convention. Unless there are overwhelming reasons to the contrary, I believe that we should reject the motion. At any rate, to establish the principle that the motion is being challenged, I am in favour of having a vote this afternoon.

3.54 p.m.

Mr. Geoffrey Finsberg: This is the first time that the House has had to consider a motion of this kind since the new procedure was adopted. This is the kind of safeguard that the House wants. I think that it is a justification for the right hon. Member for Sunderland, North (Mr. Willey) not having to explain the motion in detail. I should have thought that, under the new procedure, the majority would have felt that they were being protected from some of the trivial cases that have been put before the House in the past.
The questions posed by my hon. Friend the Member for Burton (Mr. Lawrence) would probably be covered by the fact that these matters would have to be taken into account before you, Mr. Speaker, gave permission for the motion to appear on the Order Paper today.
I think that one matter needs to be considered. Both the hon. Members for


Birmingham, Perry Barr (Mr. Rooker) and Bolsover (Mr. Skinner) seemed to indicate that the leak, if leak there was, came from either a Member or a journalist. But there are people other than Members or journalists. I still like to believe that, even if it were a journalist, there are people who, when the question was put by a Select Committee, would still have enough honour to say "Yes, I was responsible for giving this information to a journalist". Some hon. Members laugh, but laughs occasionally come from those who do not understand honour. There are some people who still have a sense of honour. Therefore, I believe that the right hon. Member for Sunder-land, North was right to raise this matter. In case I may be misunderstood, I am saying not that journalists have no sense of honour but that their informants have no sense of honour.
Lastly, this matter is very much allied to what many hon. Members have been complaining about in this House for four years. I refer to the release of Government documents to the Press in advance of release to Members. That matter has been raised for at least the last two years and promise after promise has been made by the Lord President in respect of it. So far talks have taken place, but nothing concrete has emerged.
If this matter is referred to the Committee of Privileges and it appears that we are discussing the premature release of a document which had been laid on the Table but had not yet been printed because of the incompetence of the printing authorities of this House, it will bring into question again why Members should not be entitled to have documents as soon as they are laid on the Table or at least at the same time as the Press. For that reason, I believe that the motion deserves support, and I shall certainly vote for it if it is challenged.

3.57 p.m.

Mr. George Cunningham: If we pass the motion as it stands, as I understand it, the Committee of Privileges will be free to consider only the reports which appeared in The Guardian and the Daily Mail. As other hon. Members have said, there have been reports in other newspapers in which there was speculation about the same Select Committee report.
It has not been open to anyone, as I see it, to table an amendment to this motion, because it was put down only on Friday, in accordance with the new procedure. But I for one would not be prepared to support the reference of these two newspaper reports to the Committee of Privileges unless the Committee were also free to look at other reports which appeared before them. I understand that there might have been difficulty about raising the question of reports in other newspapers if it were not done immediately after they appeared, but I do not think that there should be any objection to the Committee of Privileges being free to look at those other reports, even though it might not have been in order to raise them at the time. I seem to hear mutterings that the Committee is in fact free to look at the other reports.

Mr. Speaker: Order. Perhaps I may help the hon. Gentleman. If he had read the ruling that I gave on Friday, he would have seen that I made it quite clear that the Committee could look into any of the facts and circumstances surrounding the question, and other newspaper reports could well come within its purview.

Mr. Cunningham: Would the Committee be free to recommend to the House that some disciplinary action should be applied to those other newspapers? [HON. MEMBERS: "Yes."] If so, I think that the wording is very curious. However, if I am assured that it means that, then that point at least falls.
I think that on this occasion, given that there have been reports in other newspapers upon which no action was taken at the time, we should not pick out these two newspapers for what they have done.

3.59 p.m.

Mr. Dudley Smith: As Vice-Chairman of the Select Committee, I support the motion tabled by the right hon. Member for Sunderland, North (Mr. Willey). I am the last person to want to fly to parliamentary privilege, because I think it is often regarded with a certain amount of suspicion outside this House. Therefore, we should be very careful in acceding to this procedure.
The difficulty in this instance is that a Select Committee dealing with a controversial and important subject allegedly


saw its findings leaked to the Press only an hour or two after its final deliberations and positive conclusions.
I think that the House will benefit from an inquiry into this type of incident. Surely it calls into question the whole of the Select Committee procedure. If we do not take such complaints seriously and do not look into them, in future the proceedings of any Select Committee, whether controversial or otherwise, may be leaked with impunity.

4.0 p.m.

Mr. Michael English: The new procedure is rapidly revealing its faults. With respect to my right hon. Friend the Member for Sunder-land, North (Mr. Willey), whereas, under the old system, the Leader of the House could formally move that something should be referred to the Committee, my right hon. Friend may not have realised that a Back-Bench Member cannot afford to act as if he were the Leader of the House but has to put his case for the House to approve the motion.
The motion has nothing to do with whether there was a breach of privilege in this case. You will be the first to agree, Mr. Speaker, that when you make your ruling whether a matter should be given precedence over the Orders of the Day, you are not ruling whether there has been a breach of privilege, but only whether there is, prima facie, a case to be considered by the House. In the same way, we are considering whether there is something to be investigated by the Committee.
I believe that there is something to be investigated, but it may not be what other hon. Members have in mind. Two hon. Members opposite have mentioned that the Committee's report had not been printed. If it had been printed, a breach of privilege could not have occurred. We all know that Her Majesty's Stationery Office has slowly become less efficient in the past 10 years since our Parliamentary Press was put in the same place as the rest of HMSO's printing facilities. It was not our fault. The decision was not taken by the House, it was taken by a previous Lord Privy Seal and a previous controller of HMSO—neither of whom is still in office.
If, when the report was laid on the Table, the House had had it printed—and these things used to happen even in the 19th century, though they do not happen in these more efficient days—the report would have appeared the next morning and would, no doubt, have been given to the Press in some form. Therefore, there would have been no breach of privilege. One cannot have a breach of privilege if a report is printed when the Committee desires to have it printed.
The Committee of which I am Chairman produced a report on the Civil Service in July, which was not printed until 15th September. We also produced a report recently on public expenditure. Conservative Members will recollect that they argued about whether it would be printed. It has been printed, but only several weeks after we made our report.
We cannot haul hon. Members or journalists over the coals for saying something which should have been printed anyway, but we can suggest that the Committee should investigate something other than a technical breach of privilege by some cheapskate little Member who wanted a headline and therefore chatted to his friend in the Press in the hope that next time his friend would give him a story with his name in it or the fact that the journalist knew perfectly well that he was committing a breach of privilege by listening to the cheapskate Member. The Committee should investigate why Select Committees cannot be the first to give the news to the public by the normal process of printing documents of the House. The Committee of Privileges should consider the matter referred to in the motion, but it should also consider the matters that I have raised.

4.4 p.m.

Mr. Frank Tomney: There has been much ado about nothing. The House is besotted, as usual, with its procedural and constitutional experts.
The issue has been leaked extensively in the Press and the only question that remains to be satisfied is whether the report was printed by HMSO in the normal manner. If it was, it is bound by the secrecy Acts. If not, there is no case for anyone to answer.

4.5 p.m.

Mr. Wiley: I am raising this matter not on a personal basis but on behalf of the Committee collectively. The Committee is entitled to the support of the House if it feels that there is a matter worthy of inquiry.
Questions have been raised about the presentation of the case in such matters. I am precluded from doing what some hon. Members have suggested because the Committee has not reported to the House and I, like everyone else, am bound by the fact that publication of the proceedings of the Committee or its draft report would be a contempt.

This is one of the difficulties that arise. Statements are made, but the Chairman and the Committee cannot deal with them because they are precluded from doing so by the rules of privilege. The House should realise that it was for that reason that I could not deal with the substance of the complaint.

All I can do is to say that there appears to be a clear breach of the present rules. For that reason, we feel that this is a matter which should be referred to the Committee of Privileges.

Question put:—

The House divided: Ayes 133, Noes 70.

Division No. 145]
AYES
[4.06 p.m.


Archer, Rt Hon Peter
Hamilton, James (Bothwell)
Powell, Rt Hon J. Enoch


Atkins, Rt Hon H. (Spelthorne)
Hardy, Peter
Pym, Rt Hon Francls


Atkins, Ronald (Preston N)
Harper, Joseph
Rees, Rt Hon Merlyn (Leeds S)


Atkinson, Norman
Harrison, Col Sir Harwood (Eye)
Renton, Rt Hon Sir D. (Hunts)


Beith, A. J.
Harrison, Rt Hon Walter
Roberts, Wyn (Conway)


Bell, Ronald
Heath, Rt Hon Edward
Rodgers, George (Chorley)


Bennett, Dr Reginald (Fareham)
Holland, Philip
Ross, Rt Hon W. (Kilmarnock)


Bishop, Rt Hon Edward
Hooson, Emlyn
Sever, John


Blenkinsop, Arthur
Howell, Ralph (North Norfolk)
Shaw, Giles (Pudsey)


Boscawen, Hon Robert
Hoyle, Doug (Nelson)
Silverman, Julius


Bottomley, Rt Hon Arthur
Huckfield, Les
Sims, Roger


Brown, Robert C. (Newcastle W)
Hughes, Rt Hon C. (Anglesey)
Skeet, T. H. H.


Callaghan, Rt Hon J. (Cardiff SE)
Hurl, John (Ravensbourne)
Smith, Dudley (Warwick)


Carmichael, Neil
Hunter, Adam
Snape, Peter


Cartwright, John
Jessel, Toby
Spicer, Michael (S Worcester)


Clark, Alan (Plymouth, Sutton)
Johnson, James (Hull West)
Steel, Rt Hon David


Clemitson, Ivor
Kaufman, Gerald
Stewart, Ian (Hltchin)


Cocks, Rt Hon Michael (Bristol S)
Kelley, Richard
Stewart, Rt Hon M. (Fulham)


Cohen, Stanley
Kerr, Russell
Stoddart, David


Coleman, Donald
Knight, Mrs Jill
Stradling Thomas, J.


Cormack, Patrick
Le Marchant Spencer
Strauss, Rt Hon G. R.


Costain, A. P.
Lloyd, Ian
Summerskill, Hon Dr Shirley


Cox, Thomas (Tooting)
Loveridge, John
Thorpe, Rt Hon Jeremy (N Devon)


Cronin, John
Mabon, Rt Hon Dr J. Dickson
Tinn, James


Cunningham, Dr J. (Whiteh)
McCrindle, Robert
Tomlinson, John


Davis, Clinton (Hackney C)
Macfarlane, Nell
Torney, Tom


Doig, Peter
MacFarquhar, Roderick
Varley, Rt Hon Eric G.


Dormand, J. D.
MacKenzle, Rt Hon Gregor
Wainwright, Edwin (Dearne V)


Ellis, John (Brigg &amp; Scun)
Macmillan, Rt Hon M. (Farnham)
Walker, Terry (Kingswood)


English, Michael
McNair-Wilson, M. (Newbury)
Wall, Patrick


Eyre, Reginald
McNamara, Kevin
Ward, Michael


Fairbairn, Nicholas
Mates, Michael
Watkins, David


Faulds, Andrew
Meacher, Michael
Watklnson, John


Finsberg, Geoffrey
Millan, Rt Hon Bruce
Weatherill, Bernard


Fookes, Miss Janet
Miscampbell, Norman
Whitlock, William


Foot, Rt Hon Michael
Moate, Roger
Wiggin, Jerry


Fowler, Gerald (The Wrekin)
Morris, Alfred (Wythenshawe)
Willey, Rt Hon Frederick


Fox, Marcus
Mulley, Rt Hon Frederick
Wise, Mrs Audrey


Fraser, Rt Hon H. (Stafford &amp; St)
Nelson, Anthony
Woodall, Alec


Gilbert, Dr John
Newens, Stanley
Wrigglesworth, Ian


Ginsburg, David
Orbach, Maurice
Young, David (Bolton E)


Glyn, Dr Alan
Park, George



Goodhew, Victor
Parkinson, Cecil
TELLERS FOR THE AYES:


Gow, Ian (Eastbourne)
Pavitt, Laurie
Mr. Mike Thomas and


Graham, Ted
Perry, Ernest
Mr. Alan Lee Williams.


Grant, George (Morpeth)
Pink, R. Bonner





NOES


Allaun, Frank
Chalker, Mrs Lynda
Garrett, John (Norwich S)


Amery, Rt Hon Julian
Cowans, Harry
Gilmour, Rt Hon Sir Ian (Chesham)


Ashton, Joe
Critchley, Julian
Goodhart, Philip


Bain, Mrs Margaret
Davies, Bryan (Enfield N)
Grimond, Rt Hon J.


Bates, Alf
Dunnett, Jack
Grist, Ian


Biffen, John
Evans, Fred (Caerphilly)
Hampson, Dr Keith


Bradley, Tom
Evans, Ioan (Aberdare)
Hayhoe, Barney


Brittan, Leon
Forman, Nigel
Hooley, Frank


Cater-Jones, Lewis
Freud, Clement
Hordern, Peter




Hunt, David (Wirral)
Mayhew, Patrick
St. John-Stevas, Norman


Jeger, Mrs Lena
Maynard, Miss Joan
Sedgemore, Brian


Jenkins, Hugh (Putney)
Mendelson, John
Shelton, William (Streatham)


Johnson Smith, G. (E Grinstead)
Moore, John (Croydon C)
Shersby, Michael


Kilfedder, James
Neubert, Michael
Skinner, Dennis


Lamond, James
Onslow, Cranley
Smith, Timothy John (Ashfield)


Lamont, Norman
Ovenden, John
Stewart, Rt Hon Donald


Lawrence, Ivan
Page, Rt Hon R. Graham (Crosby)
Taylor, R (Croydon NW)


Lawson, Nigel
Price, C. (Lewisham W)
Tomney, Frank


Lee, John
Price, William (Rugby)
Walder, David (Clitheroe)


Lester, Jim (Beeston)
Prior, Rt Hon James
Young, Sir G. (Ealing, Acton)


Lestor, Miss Joan (Eton &amp; Slough)
Richardson, Miss Jo



Lewis, Kenneth (Rutland)
Ridley, Hon Nicholas
TELLERS FOR THE NOES:


Litterick, Tom
Roberts, Gwilym (Cannock)
Mr. J. W. Rooker and


Mallalieu, J. P. W.
Rossi, Hugh (Hornsey)
Mr. Max Madden.


Marshall, Jim (Leicester S)
Ryman, John

Question accordingly agreed to.


Ordered,


That the matter be referred to the Committee of Privileges.

DEFENCE

Mr. Speaker: I have selected the amendment in the name of the Leader of the Opposition.

4.16 p.m.

The Secretary of State for Defence (Mr. Frederick Mulley): I beg to move,
That this House endorses Her Majesty's Government's policy set out in the Statement on the Defence Estimates 1978 (Command Paper No. 7099) of basing British security on collective effort to deter aggression, while seeking every opportunity to reduce tension through international agreements on arms control and disarmament.
The theme of this year's Statement on the Defence Estimates is basically the same as the theme of my first defence White Paper last year. It is that the defence of Britain is indivisible from the defence of the Western Alliance as a whole. Britain's security rests on our membership of the North Atlantic Alliance. The White Paper reaffirms our determination to make a full and effective defence contribution to NATO as well as to seek, in conjunction with our allies, realistic measures of arms control and disarmament by international agreement.
The search for effective measures of arms control and disarmament has continued throughout the year. On the nuclear side, we have been fully and closely consulted by the United States Administration about progress in the Strategic Arms Limitation Talks. We fully support the efforts which the United States has made and is making, and we attach great importance to a successful outcome.
Good progress has been made in the negotiations between the United States, the Soviet Union and ourselves towards a comprehensive test ban. The successful conclusion of a treaty would make a significant contribution to detente. It would impede the development of nuclear weapons and curb what has come to be called vertical proliferation. We also hope that a comprehensive test ban would help to prevent the spread of nuclear weapons.
Our own preparations for the United Nations Special Session on Disarmament which begins in New York at the end of May are well advanced. My right hon. Friends the Prime Minister and the Sec-

retary of State for Foreign and Commonwealth Affairs will both attend. They have drawn the attention of hon. Members to the draft for the programme of action for the Special Session, which we put forward in the United Nations on 1st February with other Western States as cosponsors.
We attach great importance to the negotiations on mutual and balanced force reductions, but I cannot conceal my disappointment at the lack of progress. We believe that the removal of the existing imbalance in conventional forces in Central Europe would further the cause of detente and make for a more stable relationship between NATO and the Warsaw Pact.
Western participants in Vienna have tabled proposals which would provide for mutual reductions to a common ceiling, thereby eliminating the present major disparity in ground forces of more than 150,000 in the Warsaw Pact's favour. In particular, we wish to diminish the destabilising effects of the large concentration of Soviet tanks, many of which are deployed in East Germany close to the border with the Federal Republic.
The key to the negotiations is the achievement of an agreed assessment with the East on manpower data. There are significant discrepancies between our assessment of Warsaw Pact force levels and the figures tabled by the East. We hope, however, that there may be a more detailed exchange of figures in the next few days. Each year in the defence White Paper we publish details of our force levels; each of our NATO allies participating in the talks in Vienna is equally open about its forces. Regrettably, the Soviet Union and its allies do not adopt such an open attitude on defence matters.
In the White Paper I have taken into account the French forces stationed in Germany and in the Eastern Atlantic in order to give a fair and balanced presentation. Although these forces are not integrated into the military structure of NATO, nor does France take part in the MBFR negotiations in Vienna, it seems to me that, whatever the formal position, any Warsaw Pact planner would have to take into account the French forces in the area—

Mr. Michael Mates: Why did not the right hon. Gentleman include the French forces last year?

Mr. Mulley: We did not have any such figures last year. They were put in this year at the request of the Select Committee on Defence and External Affairs.

Mr. Patrick Cormack: Will the right hon. Gentleman take them out if the election goes the wrong way in France next Sunday?

Mr. Mulley: That question is neither helpful nor relevant.
What simple figures and charts cannot, of course, show is the quality of the forces they depict. It is here that recent Soviet improvements have been particularly disturbing. It is in this area that I base my judgment that the capability of the Warsaw Pact forces is formidable and growing. Not only are there large Warsaw Pact forces facing NATO forces in a high state of readiness, organised and equipped for offensive operations, but these forces have received a great deal of new advanced equipment which has very greatly increased their offensive capability.
These increases in the capability of the Warsaw Pact do not by themselves indicate that the Soviet Union and its allies take a different view from before about the risks involved in military action against the West. I see no reason, therefore, for NATO to adopt a different deterrent strategy. In Europe the Russians know that they face a determined, united and cohesive Western Alliance. They also understand, I feel sure, that war would not bring victory to them but would bring disaster for all concerned.
What we have seen, however, in the last year is a greater willingness by the Soviet Union to deploy its military power in other areas. Soviet and Cuban military activity in the Horn of Africa is a fact which is profoundly disturbing, not least to those in Africa and elsewhere who believe that the African countries should decide their own future and their own development. Recent events in the Horn of Africa have shown that the Russians are not only capable of bringing military power to bear but are prepared to do so.
It is, nevertheless, Europe and its surrounding seas which remain the vital area to our security and where we make our main contribution to Western security. It is in Europe that we have to convince a potential aggressor that the use of force, or the threat of its use for political ends, is simply not worth any risks. To do this, the Alliance does not have to match the forces which it faces across the East—West divide, but it must have enough forces to deter aggression, to make it clear that the risks involved in aggression are quite out of proportion to any advantage the aggressor might hope to gain.
The Alliance has to deploy sufficient conventional forces to avoid lowering the nuclear threshold, together with sufficient theatre and strategic nuclear weapons to complete the triad of deterrence. The conventional, theatre nuclear and strategic nuclear forces which the Alliance maintains are interdependent, and effective deterrence requires a combination of all three in sufficient numbers to present a complete range of credible defensive options.
It is in this context that I turn to enhanced radiation weapons, which have been given the meaningless title of neutron bombs. These weapons are basically little different from the existing nuclear weapons which are deployed by both sides. Like other nuclear weapons, if they were used they would have devastating effects on property as well as on people. Like other nuclear weapons, their purpose would be not to win a battle, nor even to destroy military targets. Their purpose would be simply to deter anyone from thinking that a successful attack could be made against NATO by offering a potential response to aggression—in this case by tank formations—which is both credible and effective in relation to the level of force threatening NATO and which conveys with it the risk to an aggressor that more devastating weapons would be used if he persisted.
If NATO were to reduce the role of theatre nuclear weapons in Europe, a sufficient level of deterrence could be maintained only by a massive increase in NATO conventional forces involving equally massive increases in the defence budgets of member countries. Even then, since the Russians possess a formidable


and growing array of nuclear weapons targeted on Europe, deterrence could still only be maintained by the West possessing weapons of equivalent kind. In these circumstances, it does not make sense to single out one nuclear weapons proposal for special attention. The problem has to be seen in the context of the totality of arsenals, conventional as well as nuclear, being developed in the East as well as in the West. We must seek to preserve security while moving to lower levels of forces on both sides.
Thus, to me the questions to ask about enhanced radiation weapons are whether their possession is likely to improve deterrence and what implications their introduction might have for progress in securing arms control arrangements, and for the essential requirement that there should be no lowering of the nuclear threshold by any relaxation of political control over the use of any nuclear weapons. These are the issues which the Government, in consultation with our allies, are studying. No decisions have yet been taken.
The additional efforts which the Alliance is making to maintain deterrence are primarily in conventional forces. Unfortunately, there is no escape from the need to devote additional resources to defence if Alliance security is to be maintained. There are no cheap options.

Mr. Stanley Newens: Since much of what my right hon. Friend has said refers to increasing weaponry and continuation of the arms race, will he say whether it remains the policy of the Government to pursue the aims set out in the Labour Party manifesto of seeking in the long run the concurrent winding up of the North Atlantic Treaty Organisation and the Warsaw Pact? Or is it our aim merely to continue with an arms race?

Mr. Mulley: I thought that I had made it quite clear that our objective was to seek mutual and balanced reductions on both sides so that we may enjoy security with a much lower level of armaments—

Mr. Newens: What about winding it up?

Mr. Mulley: There is no reference in any Labour Party manifesto or resolution

that I know of calling for the winding-up of NATO. It is necessary to develop more sophisticated and, therefore, more costly equipment if it is to do its job of deterring aggression.
We for our part have announced an increase of 3 per cent. in real terms in the defence budget for 1979–80, and are planning a similar increase in the following year, subject to review in the light of our economic circumstances. These plans are in accordance with the call made at the NATO Summit meeting in London last spring. The United States Administration has followed suit by proposing to Congress a defence budget which will show an increase of 3½ per cent. in outlays in real terms in 1979. Other countries have still to take firm decisions, but there are indications that substantial extra efforts will be made by most of them.
The defence budget for the coming year, 1978–79, remains at the figure which was announced at the end of 1976, with one small change: an addition of £6 million has been made to it as part of the Government's measures to aid the construction industry.
We have, however, been able to mitigate very considerably the effects of the cut of £267 million at 1977 survey prices which was made in December 1976. We consulted NATO about how we could make this reduction with least effect on our front-line contribution to the Alliance. In the last few days we have told the Alliance that we have been able to avoid making many of the cuts which we then believed would be necessary.
This is possible because the rates of expenditure on a number of our programmes—for example, the Tornado aircraft—have been somewhat less than we predicted at the end of 1976. The reasons are complex. In part, in the case of Tornado, for instance, they stem from the difficulty of forecasting some 18 months ahead expenditure on a collaborative project of this magnitude and complexity. They also arise to some extent—and I regret this very much—from the inability of industry to meet its forecasts, for both technological and industrial reasons. It is too early to say what effect this will have on our plans for introducing new equipment into service, but some delay seems probable.

Mr. Alan Clark: Will the Minister be telling the House what are these various measures that we shall now be able to carry forward in accordance with our NATO obligations? If not, perhaps he will be able to touch on some of them. For example, are the economy restrictions on cruising speeds in the Royal Navy to be maintained?

Mr. Mulley: I shall be dealing with a number of the matters about which the hon. Gentleman is concerned, but I do not know whether I shall be dealing with that point of detail. However, I shall see that that point is taken up later in the debate.
The defence budget for 1978–79 is entirely in line with our aim of progressively reducing the proportion of the nation's resources devoted to defence so that the burden we bear will be brought into line with that carried by our main European allies. The cuts directed to achieving that aim have already been made. The proportion still remains somewhat higher as a percentage of our national income than that of our major European allies, but this percentage will vary according to a country's economic performance. Obviously, it depends upon the rate of growth of gross domestic product as well as movements in the defence budget itself. In addition, we need to take account of the growth of the defence expenditure of our allies. Nevertheless, whereas the 1977–78 defence budget represented about 5 per cent. of GDP, a similar calculation for 1978–79 now indicates a fall to about 4¾ per cent.
There are, of course, other ways of measuring a defence contribution. It is often pointed out that, in terms of defence expenditure per capita, Britain's contribution looks rather low. We published a table showing such a comparison in the statement accompanying these Estimates. But comparisons of military expenditures in dollars can be misleading, because they do not give a reliable comparison of what these expenditures actually purchase in each country. Adjustment for the different purchasing power of the different currencies is not easy but, for example, we estimate that in 1977 West Germany committed about 15 per cent. more resources to defence than the United Kingdom, although when con-

verted to dollars its expenditure was as much as 50 per cent. higher than ours. Clearly, in the German case, exchange rate comparisons tend to understate the relative British defence contribution.

Mr. Michael Hamilton: If our allies are doing less, is that an encouragement to the Minister that we should also do less, or is it an encouragement that we should do more?

Mr. Mulley: If the hon. Gentleman had been listening to me, I think he would have heard me indicating that our principal allies had spent more in recent years. For example, four years ago the West Germans were spending 38 per cent. more than us and they are now spending 48 per cent. more. Four years ago the French spent 10 per cent. more than us, and they are now spending 24 per cent. more. Therefore, it is not a question of their doing any less.
I have no doubt that as the debate proceeds we shall be criticised by the Opposition both for the reductions in expenditure we made in the defence review and for the further cuts at the end of 1976 as part of the general reduction in public expenditure required to meet the critical economic situation. Yet the sound and fury of this attack is accompanied by almost total silence about what policies and what expenditure would be undertaken by a Tory Administration. I trust that the right hon. Member for Chesham and Amersham (Sir I. Gilmour) will enlighten us today. The British people, and particularly the Services, are anxious to know.
So far, the only figure I have heard is a suggestion that the right hon. Gentleman favours 4 per cent. rather than the 3 per cent. increase I have proposed for 1979–80. But 4 per cent. on what? On the Estimates I am now presenting for 1978–79 of £6,919 million? Is 1 per cent.—£69 million—the essence of his argument? If so, there is very little between us as it is difficult to ensure an outturn of much more than 99 per cent. accuracy. I am sure at least that the right hon. Gentleman will agree with that, because he was 6·8 per cent—£515 million at current prices—underspent in 1973–74.
Or is it, as I think could be fairly construed from the consistent Opposition posture of negative criticism, 4 per cent. on the planned expenditure for 1978–79


as the plans stood when the right hon. Gentleman and his party left office four years ago? If that is what they mean, that means an increase of over £1,600 million at current prices.
Do the right hon. Gentleman and his right hon. Friends really mean to find another £1,600 million for defence and carry out their pledges—as they call them—for dramatic reductions in taxation and drastic cuts in public expenditure at the same time? No doubt the right hon. Gentleman will explain what he meant. No doubt he will tell us which programmes—social services, housing or whatever—are to be savaged to make all these implied things possible. As always, nothing is explicit. The 1970 General Election promise to cut prices "at a stroke" seems, in retrospect, both modest and precise.
In contrast, the Government have taken positive decisions on the defence budget up to 1980–81 which will help to finance a number of improvements to our contribution to NATO. Some of these I have already annouced and others we are still considering. They make an impressive list. First, we are keeping in service 41 Commando Royal Marines to improve our reinforcement capability, particularly on the northern flank of NATO.

Mr. Geoffrey Finsberg: The right hon. Gentleman says that he is keeping 41 Commando Royal Marines in force. Will he now answer the question which the Select Committee put to him about how he proposes to get the troops to their destinations without transportation?

Mr. Mulley: The troops will have transportation. I should, however, be open to criticism if, as the hon. Gentleman appears to be implying, I kept a permanent fleet of ships and aircraft ready, round the clock, to deal with whatever emergency arose. Obviously, there are reinforcement plans to provide the transport. I am sure the hon. Gentleman will realise that it would be insecure to give details in advance on exactly how these arrangements would be made. if we were to give a timetable and the routes by which units would travel, it would be inviting a potential enemy to take steps to intercept them.
We are bringing back HMS "Bulwark" to full operational status. The long-term

size of the Army will be increased by 1,900 men. We are making substantial improvements in the anti-tank capability of BAOR through the purchase of the helicopter-borne missile TOW and the infantry Milan missile. By the end of 1978, the total number of anti-tank guided weapon systems in BAOR will increase by 60 per cent. compared with 1974, while the total number of surface-to-air missile systems in BAOR and RAF Germany will have gone up by 160 per cent. We are making available, as reinforcements, extra armoured, artillery and infantry units, and we are improving our plans to mobilise the reserves and reinforce BAOR.
A wide range of improvements is being made to the Royal Air Force, including the purchase of 30 Chinook medium-lift helicopters, which will greatly increase the load-carrying capability of our forces in Germany.
I am also pleased to be able to announce today that, subject to the conclusion of final contractual negotiations, agreement has been reached to buy a number of second-hand VC10 aircraft for conversion into tankers for air refuelling. These aircraft will form a new VC10 tanker squadron to supplement the present two Victor tanker squadrons and will add significantly to the Royal Air Force's operational capability. Because tankers can give fighters and strike aircraft greater range and longer endurance, they increase the capability and the capacity of these combat aircraft—and at a relatively modest cost.

Mr. Kenneth Lewis: How does the right hon. Gentleman propose to recruit and to keep the men who are required to fly these extra aircraft, since at the mement the Royal Air Force is losing the men who are qualified to fly and cannot recruit fresh people because of the reduced salaries being paid?

Mr. Mulley: I shall be saying a few words about the problem a little later. As for the general problem of recruitment, my hon. Friend the Under-Secretary of State for Defence for the Royal Air Force will endeavour to deal with that when he opens the debate tomorrow.
Other improvements to the capability of the RAF will include the construction


of hardened aircraft shelters, to be financed largely under the NATO infrastructure programme, improved air-to-air missiles and additional missile defence for RAF airfields.

Mr. Michael McNair-Wilson: Can the right hon. Gentleman say whether there will be any inter-operability between the new tanker aircraft and those of the other NATO countries?

Mr. Mulley: I think that there is such inter-operability. We have not yet bought the planes. They have yet to be converted.
We are pressing ahead with the development of the air defence variant of the Tornado with its Sky Flash medium range air-to-air missiles and AIM 9L short-range air-to-air missiles. Its important new air intercept radar will bring a new dimension to our ability to control the airspace above this country and the seas around us. The radar detection which is so essential to the effective operation of air defence will be immeasurably improved by the introduction of the new Nimrod airborne early warning aircraft, on which full development is under way.
We are proceeding as rapidly as we can with the modernisation of the Royal Navy. All three specialist warship-building yards of British Shipbuilders are fully occupied with naval orders and a large number of workers at three other yards are employed on orders from the Royal Navy. We have plans for ordering seven major warships in 1978–79 compared with three in 1977–78.
The effectiveness of the advanced new equipment which is coming into service depends on the skills and expertise of the Service men whose task it is to operate it.

Mr. John Cronin: Can my right hon. Friend tell us of any substantial progress being made in the Navy towards discarding the somewhat old-fashioned weapon which is the gun and having ship-to-ship missiles instead?

Mr. Mulley: The basic equipment of all newer ships includes ship-to-air and ship-to-ship missiles.
I am glad to say that the British Services continue to gain high marks from NATO commanders for their efficiency and technical expertise. To give but one example, the RAF Station at Bruggen

in Germany was recently awarded the highest possible marking in a tactical evaluation competition carried out by a NATO team—the first time this feat has ever been achieved by any unit in Allied Command Europe. My hon. Friend the Under-Secretary of State will, if he catches your eye, Mr. Deputy Speaker, speak further about this tomorrow.
There is some concern in the House that discontent among the Services over the subject of pay may have some effect on morale and, therefore, on operational effectiveness. As the House knows, the Armed Forces Pay Review Body is due to make recommendations on Service pay. My right hon. Friend the Prime Minister has not yet received this report, and it would be wrong for me to try to anticipate what it may contain or what the Government's decisions will be. I can assure the House, however, that the effective date for the pay increase will be 1st April. I am sure that all ranks in the Services understand the need for pay restraint if inflation is to be controlled and the economy restored to health. It wages get out of control, we shall have taken the brake off inflation as surely as night follows day. The economic consequences would affect defence just as much as any other part of the nation's activities. The country's ability to sustain a defence programme which makes a full and effective contribution to the Alliance depends on a strong economy and a sustained rate of growth. Opposition policies would put all these things at risk.

Mr. Emlyn Hooson: I am sure that the Services are agreed on the need for restraint, but nevertheless they see productivity deals negotiated in other spheres and they are well aware of the deal made with the firemen and so on. Will it be made clear to the Review Body that it can take matters of this kind into consideration?

Mr. Mulley: We have given the Review Body all the relevant information to permit it to consider these questions. However, as I have said, it would be wrong and unfair to the Review Body and to the Services for me to speculate at this stage about what the recommendations might be.

Mr. Cranley Onslow: I am sure that the House will respect


what the right hon. Gentleman says about the report of the Review Body, which, if it is to maintain any pretence to be independent, must be allowed to make up its own mind. However, I do not understand what he means when he says that he does not feel able to anticipate the Government's reaction. I do not know what that long and rather waffly bit that he put in just now was supposed to be if not an anticipation of Government reaction.
Will the right hon. Gentleman say categorically whether he is prepared to be as sympathetic to the Services as he has been, or his Government have been, to the firemen and the police, or will he treat them less generously?

Mr. Mulley: It is necessary to await the report. [HON. MEMBERS: "Why?"] Because it might well be that the hon. Gentleman's expectations would be satisfied by the Review Body. It would be wrong for the House to debate a report before it was even completed.

Mr. Mike Thomas: I am sure that the Secretary of State can give the House a categorical assurance that the Armed Forces will be treated fairly on pay. Is it not the case that that is not the object of the Opposition but that their object is purely to make political mischief out of it?

Mr. Mulley: That is an observation that could properly be made of some contributions to the pay debate. I have heard it said about some sections of the media that, no matter what we did for the Forces, it would still be claimed to be inadequate. We need to make clear that in the recent past almost all sections of the community have found that the rise in their incomes has not been enough to compensate for higher prices and that in consequence their standard of living has fallen.
The Armed Forces are no exception to that, nor are they unique in having suffered in this way. But we do recognise, as the Review Body said in its last two years' reports that the Forces have suffered relatively more than those with whom their earnings are normally compared, and we have undertaken to restore the comparability of their pay as soon as incomes policy permits. I hope that there

is no hon. Gentleman in the House who does not think otherwise than that I shall do my damnedest to see that the Forces get a fair deal.
I should like at this point to dispel an illusion about the relationship between Forces' pay and the defence budget. Restraint on pay has nothing whatever to do with cuts in the defence budget. As the House knows, the defence budget is increased to take account of pay and price increases. Supplementary Estimates will be presented to the House to provide for the pay increases which are to be awarded from 1st April. So the future level of Forces' pay, just as past levels, will not be constrained by the level of the defence budget.
I am sure that the House will join with me in expressing appreciation for the splendid achievements of our service men and women over the past year. Not only have they made their contribution to the preservation of peace and security in Europe, and in the world; they have continued to carry out very difficult and thankless tasks with courage and skill in support of the civil power in Northern Ireland. Last year, members of the Armed Forces earned 20 awards for gallantry in Northern Ireland and 29 soldiers gave their lives. I should like to make particular mention of the Ulster Defence Regiment, which suffered 14 of these casualties.
The task before the security forces in Northern Ireland remains an arduous and demanding one. We have decided to increase the number of resident units stationed there with their families from five to seven. This is not an increase in the total number of soldiers in Northern Ireland. These extra resident battalions will reduce the numbers of units required to undertake unaccompanied four-month tours and provide operational continuity in their areas of responsibility. It is a measure which will go some way to reducing turbulence in the Army and, together with the retention of 41 Commando Royal Marines and the creation of a new composite battalion at the School of Infantry at Warminster, will reduce the extent to which it is necessary to draw on BAOR for units to undertake emergency tours in Northern Ireland.
The House has paid tribute already to the achievements of Service men from all


three Services in maintaining fire cover during the firemen's strike between mid-November and mid-January. Since then the Services have been engaged in relief operations in the snow in Scotland and in the West Country. As is their custom and tradition, the Services turned to these extra tasks with professionalism and good humour. For many they meant separation from their families and long hours of pay. [HON. MEMBERS: "Pay?"] Separation from their families and long hours of duty. They also work long hours for their pay.
The year ahead will be a challenging one for Britain and for the Alliance. The meeting of NATO Heads of Government last May gave a fresh impetus to the work of the Alliance in preserving peace and security. This work rests on twin pillars—detente and deterrence. Real security in the long run requires a reduction in the military confrontation between East and West. It is essential to bring home to the Soviet Union and her allies that the increasing capability of the Warsaw Pact forces is a threat to detente and a threat to stability. This is why it is necessary also to continue to build up the defences of the Alliance to ensure that deterrence is maintained. This requires an effort from all members of the Alliance.

Mr. Julian Amery: It appears that President Carter last week undertook on behalf of the Alliance to ensure the integrity and independence of Yugoslavia. Is the right hon. Gentleman satisfied that the forces of NATO at his disposal are capable of ensuring the fulfilment of that pledge?

Mr. Mulley: I do not think that it is appropriate to discuss NATO contingency planning on the Floor of the House.

Mr. Tom Litterick: If the NATO Powers were unable to guarantee the integrity of Cyprus, how can they claim to have any hope of guaranteeing the integrity of Yugoslavia?

Mr. Mulley: My hon. Friend's interjection only underlines what I said. It would be unwise to become involved in speculative discussion on speculative contingency arrangements. There is no doubt that Britain is playing a full part not

only by the extra contribution we are making in terms of resources but by pursuing practical measures of co-operation to ensure a more effective use of the totality of the resources available to the Alliance and to seek every opportunity of reaching arms control and disarmament agreements.

5.0 p.m.

Sir Ian Gilmour: I beg to move, to leave out from "House" to the end of the Question and to add instead thereof,
'regrets that the defence policy of Her Majesty's Government during the last four years has damaged the security of the United Kingdom and has harmed the prospects of reaching international agreement on arms control and disarmament.'.
I shall begin on a note of agreement. The Opposition entirely endorse all that the Secretary of State said in praise of our troops and Service personnel everywhere, and, in particular, what he said in praise of the Army in Northern Ireland. We debated security in Northern Ireland last week, and we shall do so again in greater detail on the Army Estimates, but we should not let this occasion pass without putting on record once more our respect and admiration for the Army for the magnificent way in which all have unflinchingly and skilfully carried out their onerous and dangerous duties.
Otherwise, as it expected, the House has just listened to a thoroughly complacent speech, just as it was presented with a thoroughly uninformative White Paper. Anyone who relied solely on the Secretary of State for his information would not gain a remotely accurate picture of our forces today. The portrait painted by the right hon. Gentleman is quite unrecognisable—it is not even a caricature—since the truth is that there is in the Services now an unprecedented crisis of morale and an unprecedented lack of confidence in the Government.
Our Armed Forces feel, quite understandably, that they suffer from a lack of recognition by the Government of their proper status and value. As a result, there has been a serious exodus from the Services of skilled and experienced officers and men, and very many of those who remain are fed up with the way they have been treated—the way they have been treated over pay and the way the Government have put defence at the bottom of their priorities.

Mr. Litterick: Mr. Litterick rose—

Sir I. Gilmour: I have hardly started yet. I assure the hon. Gentleman that he will have more to interrupt me about a little later.
When one adds to all that the position in Northern Ireland and what General Haig has called the "explosion" in Russian military capability, one is almost tempted to sympathise with the Secretary of State. We might even fear that all his terrible problems and worries would cause him many sleepless nights—or, rather, in his case, days—but then he forfeits sympathy by his complacency, and I shall now seek to inject a little realism into the debate.
The past four years have been just about the most disastrous which our Armed Forces have suffered since the days of Lord North 200 years ago. They have been disastrous because of the savage cuts which the Government have imposed, because of the Government's disregard of the Forces' interests over pay, and because of the tilting of the military balance against the West and in favour of the Warsaw Pact.
The Government have now cut, or plan to cut, £10,000 million off defence spending, and in so doing they have done enormous damage to our Forces and have also damaged NATO. That is not just the opinion of the Conservative Opposition. The all-Party Defence and External Affairs Sub-Committee, to which the House owes a great debt—above all, to its Chairman, my hon. and gallant Friend the Member for Eye (Sir H. Harrison)—reported last year in these terms:
In our view, the point has now been reached where our Forces are being seriously deprived of modern equipment necessary to maintain, with the other members of the Alliance, sufficient conventional capability to deter the Warsaw Pact from acts of aggression, to sustain an effective fighting force in the event of actual hostilities, and thereby to avoid early recourse to nuclear weapons.
Then, last September, the Secretary-General of NATO stripped away the deceit with which the Government had attempted to clothe their defence policy. He pointed out that the Government's cuts have taken us below "the minimum level of defence" which the defence review had sought to establish. He referred to the
adverse impact on the United Kingdom front line forces",

and he reminded the Government that their dishonesty in December 1976 was not likely to help the solidarity of the Alliance.
That was a stinging rebuke from Dr. Luns, and this is all the more inexcusable because the Government have been making us weaker while the Warsaw Pact has unquestionably been growing stronger, as even the right hon. Gentleman's White Paper admits.
Thus, there is general agreement about the disastrous nature of the Government's defence policy. The all-party Sub-Committee, NATO, expert commentators—virtually all are of the same mind about the damage which the Labour Government have done. This is almost inevitable with a Labour Government, because they always have to fight on two fronts—against the threat from the Warsaw Pact and against the threat from their own Left wing.
The latter threat is visible on the Order Paper today, The Tribune Group always wants to slash Britain's defence expenditure, because it is not interested in our country's security. Members of the Tribune Group are quite happy to see Russia spending more and more on armaments—13 per cent. or 14 per cent. of her gross national product—but they always want to disarm Britain.
No one interested in Britain's security could possibly subscribe to the amendment put down by the hon. Member for Salford, East (Mr. Allaun) and his hon. Friends. Nor could anyone who supported NATO possibly support that amendment. We all know that the Tribune Group—unlike the Italian Communist Party—does not support NATO.
Moreover, the idea that workers engaged in our armaments industry could be deployed to what the amendment calls "alternative socially useful products" is more than usually lunatic. The Tribune Group has not only not noticed that under Labour there are already 1½ million unemployed but it is unaware—or, perhaps, it does not care—that Labour's defence cuts must have cost over 150,000 defence jobs already, and the Tribune Group's proposals would cost 300,000 more defence jobs. Labour is the party not only of defence cuts but of defence unemployment as well.
It is noteworthy that hon. Members with defence industries in their constituencies figure quite prominently among the signatories to the amendment. It would take a long time to go through them all, but I shall single out one or two. I see the names of the hon. Members for Preston, North (Mr. Atkins) and Preston, South (Mr. Thorne), whose constituents depend on BAC and the Tornado. They are supporting an amendment which would make a lot of their constituents unemployed.
The hon. Member for Southampton, Test (Mr. Gould) is in much the same position, with several defence contractors in his constituency. Next, I mention the hon. Member for Chorley (Mr. Rodgers)—

Mr. George Rodgers: Will the right hon. Gentleman give way? He mentions me by name.

Sir I. Gilmour: Let me just finish the sentence. The hon. Member for Chorley has a Royal Ordnance Factory in his constituency, and his defence policy would put many of his constituents out of work.

Mr. Rodgers: The right hon. Gentleman visited my constituency and the Royal Ordnance Factory recently. He did not have the courtesy to inform me of that visit. He advised people in my constituency that their jobs were at risk. I consulted the Minister of State at the Ministry of Defence, who advises me that, in fact, not only will jobs be maintained but there will be greater job opportunities in the future than there are at present. Perhaps the right hon. Gentleman will now withdraw his suggestion.

Sir I. Gilmour: I visited the Conservative Party in Chorley, for which I did not need the hon. Gentleman's permission. I agree—I am sorry that I did not do so—that I should have mentioned that I intended to go to the Royal Ordnance Factory, but I did not at the factory tell his constituents that their employment was at risk. I made no political intervention of any sort in his factory. But the truth is that what the hon. Gentleman proposes would have a most adverse effect on his constituency. The same goes for a great many other hon. Members on the Left as well.
In any event, because the Labour Party has so many members who are vocally opposed to British and Western interests, its defence policy is based not on the security needs of the nation but on the interests of the Labour Party
That, then, is the murky background to the White Paper. If the phrase be permitted, the White Paper is full of distortions and omissions. Nothing is said about the future of the nuclear deterrent, the cruise missile is not mentioned, the Russian SS20 is not mentioned, the so-called neutron bomb is not mentioned, although I was glad that the right hon. Gentleman mentioned it today. Strategy gets only a few perfunctory lines, and pay gets one short paragraph. The distortions concern the threat, defence expenditure and, of course, the damage which has been done.
Naturally, we welcome the improvements to which the Secretary of State referred this afternoon—some of them are mentioned in the White Paper—but, welcome though they are, they are very little indeed compared with the deterioration which the Government have caused. If a man partially ruins his house, it is not very sensible then for him to boast that he is about to repaint his garden fence, and that is the right hon. Gentleman's position now.
I welcome the right hon. Gentleman's decision to buy 30 support helicopters, and I congratulate him upon it. Of course, we welcome the decision to restore HMS "Bulwark" to full operational status, but who decided to pay off HMS "Bulwark" prematurely? Naturally, it was the Labour Government in their defence review.
We welcome the decision to make a small increase in the size of the Army, but why does it have to be increased in size? It is because the Labour Government substantially cut it in the defence review. They are still trying to cut the Brigade of Gurkhas by trying to remove the battalion from Brunei.
The White Paper says that
The Army is increasing the number of Milan anti-tank missiles being deployed to front-line units in 1978.
We are glad to hear it, but who slowed down their deployment in the first place? It was the Labour Government, of course.
The Secretary of State referred this afternoon to the inclusion for the first time of some of the French forces in the military balance. As he said, there is an argument for including them, although to include them in tables in which they have not previously been included distorts comparisons.
Moreover, as my hon. Friend the Member for Staffordshire, South-West (Mr. Cormack) pointed out, the Government chose rather an odd year. Did nobody in the Cabinet, including the right hon. Gentleman, tell the Cabinet that there were to be French elections this year? Did nobody tell the Cabinet that there was the possibility of a victory by the Left? We do not know what will happen in the second ballot, but for the Government to choose this year to put in the French forces for the first time, when there is a distinct possibility of the formation of a French Government containing Communist members, surely shows a remarkable lack of foresight or a remarkable anxiety to deceive and play down the threat.

Mr. Cormack: The latter.

Sir I. Gilmour: It was probably both.
It was a fatuous exercise, because the truth about the threat is widely known. We have heard President Carter, Dr. Luns, General Haig and our own defence chiefs. As the International Institute for Strategic Studies has said,
In general, the pattern is one of a military balance moving steadily against the West.
The White Paper almost ignores the vital question of pay. The Secretary of State told us nothing of value about it this afternoon. His behaviour over pay has been negligent and indefensible. Within a matter of weeks of presiding last year over the award of an Irishman's rise to the Forces, which excited universal resentment and derision, what did he do? Instead of keeping out of the public eye, which he should have done in all decency, he flaunted himself on the picket lines at Grunwick, an astonishingly insensitive thing to do. He was showing himself to be much more active on behalf of his own trade union than on behalf of the members of our Armed Forces, who do not go on strike and whom he is supposed to represent. I doubt whether the Service men will forgive the right hon. Gentleman for that.
That was not the end of the Secretary of State's offensiveness to the Services. When many members of the Forces were working an 80-hour week to save the country from fires they were paid much less than the firemen and were working longer hours. My hon. Friend the Member for Stretford (Mr. Churchill) asked a Question comparing the pay and conditions of the Services with those of the firemen. With incredible gall, the right hon. Gentleman replied:
The Services are used to working long hours in an emergency and a liability for duty at any time is one of their conditions of service which is taken into account in fixing their rates of pay."—[Official Report, 25th November 1977; Vol. 939, c. 933.]
He then went on about the firemen.
That answer was not only grossly insulting to the Forces but completely untrue. Their long hours of work and liability for duty in an emergency have not been taken into account in fixing their rates of pay during the past two years. The X factor, which is meant to compensate them for those conditions, has become a minus. Despite their long hours and their liability for emergency service, the Forces are now paid less than other people. They have completely lost comparability and have fallen way behind.
Both the Prime Minister and the Secretary of State make much of the so-called independence of the Armed Forces Pay Review Body. The Review Body is independent when its suits the Government to say so and not at all for the rest of the time. In fact, as both the Secretary of State and the Minister of State have admitted, the Review Body is subject to, and is not independent of, the Government's policy on pay. It is therefore dishonest of the Government to try to hide behind the Review Body.
Moreover, the right hon. Gentleman behaves as though in some mysterious way he is independent of his own Government's pay policy. He is not. It is his Government's pay policy which has reduced the Services to such desperate straits. The right hon. Gentleman is responsible for that.
In any case, the right hon. Gentleman has a commitment to honour. Last year he sent a message to the Forces, and he repeated it here last June, when he said,
it is our intention that the rigid nature of the


first two pay rounds, which have produced distortion in some pay structures in the professions, industry and other fields, including the Armed Forces, will—although we do not know yet the shape of round 3—be put right in future rounds of the policy. I shall ensure that the needs of the Armed Forces are taken into account. I also give that assurance to the House."—[Official Report, 16th June 1977; Vol. 933, c. 610.]
That statement was not exactly a trumpet call, but it was a commitment, and the right hon. Gentleman has not honoured it. How has he ensured that the interests of the Services have been taken into account in the pay policy? He has not, and they have not been. The Secretary of State has not metaphorically stood in the picket lines for the Armed Forces. He has let them down, and he should have resigned.
The essence of the military salary is, or should be, comparability with civilian rates. Therefore, as I urged last November, it is vital that the Review Body should set out in its report what increases are needed to restore comparability and thus to restore the military salary to its proper level. The Armed Services and the police are unique. The State relies upon them for its security, and they do not have the right to strike. Therefore, the State owes them a special duty.

Mr. Roderick MacFarquhar: If the Armed Services and the police are unique—and I think that the right hon. Gentleman has a point there—how does one establish comparability?

Sir I. Gilmour: If left to itself, the Review Body ensures comparability. That is the essence of the military salary. The police are not my concern, but I understand that a committee is considering their pay and is to report shortly.
Assuming that the Review Body sets out proposals for an immediate pay settlement more or less consistent with the Government's so-called pay guidelines, that should be taken into account in considering charges for accommodation and food. We cannot have another Irishman's rise. Plainly, too, the X factor, which is now a minus, should be increased.
The Chancellor of the Exchequer made clear at the beginning of the current pay round that in certain circumstances earnings could exceed the pay guidelines.

That point is particularly relevant here, because, as the Chief of the Defence Staff pointed out recently, the Forces have fared "among the worst" during the pay policy. It is particularly relevant because the White Paper admits that there has been a large increase in the number of highly trained officers and men getting out of the Forces. They are not being paid the rate for the job, and they cannot afford to stay in. The point is particularly relevant because the Forces cannot benefit from wages drift. It is particularly relevant, because, as the hon. and learned Member for Montgomery (Mr. Hooson) said, although the performance and productivity of the Forces are outstandingly good, they cannot secure productivity deals.
The point is also particularly relevant because the forces are, with the police, unique. Therefore, the Review Body must point the way towards an early return to comparability, and in their response the Government must set out how they propose to restore Service pay to a proper level within a short time.
The Secretary of State and the Government cannot be allowed to go on breaking their commitments to the Armed Forces. They have a clear obligation, and the Secretary of State has made an explicit commitment, to start giving the Forces proper treatment and stop ignoring their needs and interests. Even the right hon. Gentleman must realise that if something substantial is not done next month he cannot retain his office. He will have to resign.
The remaining distortion in the White Paper is what is said about future defence expenditure. The Government's claim—I was sorry that the Secretary of State made it again this afternoon—is that they are responding to the NATO agreement to increase defence expenditure and that the figures given for 1979–80 and succeeding years reflect that agreement.
That claim is doubly bogus. The Government's public expenditure White Paper Cmnd 7049, said:
The main policy development since Cmnd 6721 has been the agreement reached by NATO Ministers in the summer of 1977 that they should aim at an anuual increase in defence expenditure in the region of 3 per cent. for the period 1979 to 1984 in order to avoid a continued deterioration in the relative defence capabilities of NATO and the Warsaw Pact.


The provisional Defence Budget figures for 1979–80 and 1980–81 have been revised in the light of this agreement, and they provide for annual growth of 3 per cent. over the revalued Cmnd 6721 figure for 1978–79. The 1980–81 figure will be subject to review.
Anybody reading that would believe that the figure for 1979–80 had been revised upwards because of the NATO agreement. In fact, it has been revised downwards. Therefore, the Government's intention to deceive is plain. Instead of the figure for 1979–80 being an increase, it is a cut. Before the NATO agreement, the Government had planned to spend £55 million more than they decided to spend since the NATO agreement.
The House will be aware that cuts in defence expenditure are measured by cuts in planned expenditure and not by cuts in what was actually spent the year before; otherwise the hon. Member for Salford, East would be right in his claim that the Labour Government far from cutting defence expenditure, have increased it. Unless the Government are prepared to admit that they have been lying all the time to their supporters, they have to admit that they cut defence expenditure in 1979–80, rather than increased it. Either the claim of the hon. Member for Salford, East—who has been consistent in this regard—is right or the Conservative Opposition and myself—who have also been consistent—are right. It is not possible to defend both points of view. What the Government have said is totally inconsistent with the two. Is the Secretary of State now prepared to agree with me or with his hon. Friend the Member for Salford, East? Unless the Secretary of State admits—and his silence will admit that—that what he is saying about next year is totally wrong, then he must say that he either agrees with me or with his hon. Friend.

Mr. Mulley: The right hon. Gentleman rather belatedly came upon this point. It has been made quite clear in the public expenditure White Paper that the 1979–80 figure was less than that in the previous White Paper because of the intervention of the cuts that we had to make as part of the general reduction in public expenditure. The NATO Review—this is not exactly similar, but there have been reductions in planned expenditure in the United States—deals with expenditure to start in 1978–79, which is

required to be increased by 3 per cent. That is what we are doing.

Sir I. Gilmour: The right hon. Gentleman seems to be saying that it is all right to tell lies in the text of the White Paper as long as the truth is concealed in the footnotes. That may well be his attitude, but I suspect that it is more the attitude of the Chancellor of the Exchequer.

Mr. Mulley: The right hon. Gentlemen's passion, candour and frankness would be reflected if he told us what he meant by 4 per cent.

Sir I. Gilmour: The right hon. Gentleman talked about the figure being affected by cuts in 1976 which, of course, it is not. The 1979–80 figure was not affected. That is a bad excuse. Either he has to admit that what he means by cuts has suddenly changed its meaning to suit his Government and that it suddenly means what the hon. Member for Salford, East has said. Or, he must agree with me. If he does not, then he is showing that he is paying no regard to the truth of the matter at all.

Mr. Frank Allaun: The right hon. Gentleman shoots from the hip. He knows very well that to talk of £10 billion cuts—which is frequently the figure mentioned from the Conservative Benches—is utter nonsense. The actual figure is an increase last year of £200 million. This year it stays the same and then rises by £200 million a year for each of the succeeding three years. The £10 billion is in reference to wild, impossible and vague estimations for the future 10 years hence, which was made by the Conservative Party way back in 1973 and which no Government could have put into practice.

Sir I. Gilmour: The hon. Gentleman is fully consistent, and I respect him for that. I only wish his right hon. Friend were equally honest. In fact, the figure of £10 billion is not my figure. It is the Government's figure. There is no disagreement in that respect. The Government have not only been totally dishonest in that regard but their claim is bogus from another point of view as well.
The only reason for the increase in 1979–80 over 1978–79 is that 1978–79 suffered a very large cut in December 1976. Indeed, the cut of £267 million between


1978–79 was greater than the alleged increase planned for 1979–80. That alleged increase is due to the base line this year having been drastically lowered. It is not next year that will be increased, it is this year that has been cut. That is the truth about the right hon. Gentleman's so-called increase.
For the increase in 1979–80 to have been a genuine one, the Government would have had to restore the cut this year in 1978–79. That is what the Conservative Party and the Liberal Party asked for during the debate in another place last December. When the Government refused, the Liberal Party then voted with the Conservatives against the Government. Since that cut has not been restored, and since the 1979–80 alleged increase is bogus, the Liberal Party has no reasonable alternative but to vote with us tomorrow night. Whether the Liberal Party will be reasonable, we do not know. The Lib-Lab pact may decree that it cannot be rational, but it is hard to see how the Liberal Party could change its decision between December and March.

Mr. Hooson: Certainly there is a reason. As a result of negotiations, the Government have increased net expenditure by 3 per cent. In fact, Dr. Luns has expressed in this House his belief that NATO is now in a position to meet any attack by the Warsaw Pact.

Sir I. Gilmour: The hon. and learned Member was not listening to what I was saying. However, he will be able to read it in Hansard tomorrow before he votes. He will see that there has not been a genuine 3 per cent. increase at all. He does not have much of an excuse to vote with the Government. However, I can see the Liberal Party making a mockery of itself in this matter, by changing its mind between December and March.
The Secretary of State asked how much we shall spend on defence. That is rich, coming from him and from this Government. Since they have been in office they have never once spent anything like that which they originally intended to spend. The Government have full access to the books—indeed, fiddle them—and yet they never get their expenditure right even one year ahead. Since their much-vaunted defence review, which was meant to bring stability to the Services—that was the

sick joke of the decade—they have made four cuts in defence up to this year and have planned another in 1979–80. That is not all. Even after their cuts, they then so arranged matters that they are not able to spend what they have got. In 1976–77 they underspent by £218 million and in 1978–79 by £85 million. In other words, the right hon. Gentleman does not know how much he has to spend and then does not spend what he has got.

Mr. Mulley: I am delighted to have that assumption from the right hon. Gentleman, who is an expert. Perhaps he will explain how he came not to spend £515 million in his short term as Secretary of State in 1973–74?

Sir I. Gilmour: I was in office for only seven weeks. If I really underspent by £515 million, I must have been working very fast indeed. I was not Secretary of State in 1973.
Until we have seen the books, and until we have unfiddled them, we cannot possibly say how much we shall spend or where. But I can assure the right hon. Gentleman and his squad on the Labour Benches that we shall spend more than him. As my right hon. Friend the Leader of the Opposition has made clear, we put the security of the country at the top of our priorities. But plainly, without full access to the books, the Chiefs of Staff, the scientists, the civil servants, industry and our allies, we cannot be specific about what we shall do. Nor can the right hon. Gentleman possibly expect us to be. It would be irresponsible and naÏve, and he knows that.
The right hon. Gentleman talked about my 4 per cent. I said "at least 4 per cent.", and I did not specify the base line. In other words, to quote a former Labour Prime Minister, I shall keep my options open. That, I would have thought, is an extremely sensible thing to do. I prefaced my remarks by saying that I did not want to give any figure at all. My Press conference was to draw attention to the Government's dishonesty about Government expenditure, and the right hon. Gentleman has confirmed that this afternoon.

Mr. Frank Hooley: The right hon. Gentleman may be very woolly about his proposals, but we all know what his Administration did when


it was in power. In real terms there was a cut in defence expenditure when the Conservatives were in office.

Sir I. Gilmour: If that is so, it is very odd that the Labour Party kept on complaining that we were spending more.
The most important thing is that there should be a restoration of morale to our Armed Forces, not only by paying them properly but by making their supremely important job fully worth while again and providing them with proper tools to do the job.
Air defence is another priority. As Professor Erickson had pointed out, the Soviet Union's tactical air power in the past seven years
has been transformed from a defensive force into … one which is able to mount offensive air operations of considerable depth throughout the NATO area".
Professor Erickson added,
A concentrated air assault on the United Kingdom
involving some 400 Soviet sorties over a 24-hour period is "now eminently feasible" and poses "a direct threat ".
Anti-tank defence is also vital, as the Secretary of State said this afternoon, and the Defence Sub-Committee recently produced a valuable report on the importance of reserves.
On the general question of manpower the Secretary of State said the other day,
You have to man on planned expectations".
To do that is to fly in the face of all experience. The rational thing is to plan on the basis that one will be faced with unforeseeable contingencies. As the Vice-Chief of the General Staff said two years ago, virtually all of the 47 to 50 shooting operations that have been undertaken by the United Kingdom since the end of the 1939–45 war have come into that category. The Secretary of State plans on what he can foresee, and that is not very much.
We must naturally be guided by the nature of the threat in deciding what to do. Here, for once, I agree with the Secretary of State. While there is a very grave threat to Europe by the conventional and nuclear forces of the Soviet Union, that threat is now global. Russian behaviour in Africa is profoundly dis-

turbing. The Russians have ignored the artificial geographical boundaries that NATO imposes on itself. Without straying into a foreign affairs debate, I cannot go too far in discussing the events in the Horn of Africa but it seems pretty obvious that if the Russians always win in Africa, African leaders will draw the natural conclusion.
Soviet naval power and air power, which has increased even more spectacularly, give the Russians the capability to intervene almost anywhere in the world. Dr. Luns, General Haig and our own Chief of the the Defence Staff have warned of the global nature of the Soviet threat, without unfortunately having much effect on NATO, which keeps its attention too exclusively on the central front.
Indeed, NATO seems to me to be in danger of having a Maginot Line cornplex—without, unfortunately, having a Maginot Line. In any case, we on this side of the House believe that those statesmen and military commanders who have urged NATO to look to its southern flank are entirely right. There is an urgent need to improve the protection of our sea routes, and the remarks last week of SACLANT Admiral Kidd about the inadequacy of his forces emphasises that need.
That brings me back to the motion and to our amendment. The Government profess to be very keen on detente and disarmament but they are remarkably inept at securing either—except, of course, unilateral disarmament by ourselves. If detente is to mean very much, it should surely be world-wide. It was a Russian politician, Mr. Litvinov, who said in the 1930s that peace was indivisible. In the 1970s, if detente is to be genuine, it also should be indivisible. Moreover, it was Mr. Brezhnev himself who said in 1975:
The materialisation of detente is simply inconceivable without an extension of detente to the military sphere".
Unfortunately, ever since he made that remark the Russian military build-up, far from slackening, has accelerated.

Mr. Frank Allaun: And the Americans.

Sir Gilmour: That remark shows the hon. Gentleman in his true colours. The Americans disarmed in the 1960s.
Therefore, if we take Mr. Brezhnev's words and actions in connection, which is plainly right, there is only one possible conclusion—that detente has not materialised and it cannot materialise until the Russians stop seeking military domination in Europe and stop their imperialistic incursions into Africa. In taking that view I am not being controversial, I am merely taking the words of Mr. Brezhnev at their face value.
On the Benches opposite there is a common belief that disarmament negotiations are good in themselves. That, of course, is a delusion. Disarmament negotiations can be judged only by their results. Moreover, the SALT talks—or rather the situation which brought them about—carry great dangers for Europe. During the past 15 years there has been a great deal of talk about arms control and disarmament and there have been a number of agreements on these matters, but the sad fact is that during those 15 years the military balance has changed drastically in favour of the Russians.
About 15 years ago the United States dismantled all its medium-range missiles which were stationed in Europe; it decided to employ no more intercontinental missiles; and it cut back its medium-range bombers. On the other hand, the Soviet Union kept most of its medium-range weapons, while at the same time it built up its mammoth intercontinental armoury of missiles.
In the 1960s American restraint was not reciprocated by Russian restraint and in the 1970s there is no reason to suppose that unilateral restraint or disarmament by the West will have any effect other than to encourage the Russions to go on adding to their armaments.
Certainly for the European members of NATO the situation is just about as serious as it could be. Mr. Brezhnev is now deploying against Europe a wide range of nuclear weapons which are excluded from the SALT negotiation. He is doing so when the Soviet Union already has a pronounced numerical advantage in such continental nuclear forces. The most formidable of these weapons is the SS20 missile with its multiple nuclear warheads, which has the range to hit every city in Europe. The

Russians also have the long-range bomber—the "Backfire"—and the fighter bomber—the "Fencer".
As the German Chancellor said in London last year,
SALT neutralises the strategic nuclear capabilities of the United States and the Soviet Union. In Europe this magnifies the significance of the disparaties between East and West as regards nuclear tactical and conventional weapons.
Herr Schmidt went on:
Confined to the United States and the Soviet Union, strategic arms limitation would be bound to impair the security of Western European members of the alliance vis-à-vis Soviet military superiority in Europe, if we did not succeed in removing the disparities in Europe parallel to the SALT negotiation.
It does seem that the British Government have been remarkably supine in these matters. While the new Soviet continental missiles which threaten Europe and are suitable for a surprise attack have been excluded from SALT, the cruise missile, which is not suitable for a surprise attack, has been included. There are evidently to be restrictions on its range and there may even be a prohibition on the transfer of cruise missile technology by the United States to its European partners. All this is contrary to British and European interests. But a weak British Government with a large number of far Left-wing supporters is incapable of taking sensible action.
Faced with the history of the past 15 years, with the dangerous preponderance of Russian nuclear power in Europe, and with Russia continuing a vast military buildup, there is one course which should have been absolutely unthinkable to anyone interested in British security and the security of the West. That is unilateral disarmament by the West.
Indeed, even the Secretary of State at last seems to have realised that fact. I hope that that means that he will be supporting our amendment tomorrow night. He said on 24th January,
I am absolutely certain that if we were making unilateral reductions in defence there would be no incentive for others to seek a multilateral agreement."—[Official Report, 24th January 1978; Vol. 942, c. 1156.]
Once again amnesia has struck the Secretary of State. He has forgotten that unilateral reductions in defence are just what his Government have been making for four years. Those unilateral reductions have, of course,


removed the incentive for others to seek a multilateral agreement. Indeed, having said that, he went on to boast on the same day,
In real terms the defence budget that I shall be presenting later this year is the lowest to be presented by this Government. "—[Official Report, 24th January 1978; Vol. 942, c. 1158.]
How those two statements can be reconciled is a matter for a psychiatrist, not for me.
"The disparities in Europe" referred to by the German Chancellor, and, caused, as he said, by Soviet military superiority in Europe, certainly will not he removed by unilateral disarmament by the West. They will be removed only by general disarmament or by the West improving its own forces. And since the Russians have shown no signs of agreeing to the principle of parity in Europe, which would obviously be the best solution, the West has no alternative but to strengthen itself. One way of doing that is to deploy the enhanced radiation weapon, the so-called neutron bomb.
I agree with the Secretary of State tot Defence on this point, because not since the hullaballoo over the allegations of germ warfare in Korea has so much pseudo-humanitarian piffle been talked about any subject as has been spewed out recently over the neutron weapon. This weapon is very much less powerful than SS20 and other Russian missiles which threaten all European cities. It is said to be 20,000 times less powerful than some of the Russian weapons. It is essentially a defensive weapon, since it is designed to break up heavy concentrations of invading tank forces. Moreover, because of its limited area of destruction, it does not kill innocent civilians far away from the explosion.
For some very strange reason, this is said to make it a uniquely horrible weapon, and its critics would apparently prefer the West to continue to rely on old tactical nuclear weapons which would destroy large numbers of women and children and devastate a wide area. Just why it is particularly cruel to devise a weapon, which avoids the slaughter of women and children and does not lay waste vast tracts of land and city, has not yet been explained in the propaganda barrage that has been fired off by the Soviet Union.

Mr. Litterick: Will the right hon. Gentleman tell the House of any weapon, whether it be a hand gun or a hydrogen bomb, that does not destroy and will not continue to destroy men, women and children simply because it is used? There is no weapon that will not have that effect.

Sir I Gilmour: I am grateful to the hon. Member. That was the point I was seeking to make—namely, that there is nothing unique about the enhanced radiation weapon.
The critics of the neutron weapon also claim that its introduction will lower the nuclear threshold, the argument apparently being that, because of its efficiency, the West is more likely to have the courage to use it than it would to use its old inefficient nuclear weapons. But that, too, is an untenable argument. What would lower the nuclear threshold is the outbreak of war in Europe. Any attack by the Russians, even one with only conventional forces, would lower the nuclear threshold and therefore anything that deters such an attack raises that threshold.
Since the weapon would, if used, be likely to fall on their soil, the Germans can hardly be expected to take a strong lead on this matter. That should have come from Britain. The right hon. Gentleman said that no decisions had been taken. Why not? Because we know that this matter has been on the table for months. The Supreme Allied Commander has said that there is a clear military requirement for it. This inaction is because we have a paralysed Government who have done nothing.

Mr. Mulley: The right hon. Gentleman should realise that we are members of an Alliance and that discussions are taking place within that Alliance. He should also appreciate that a number of countries must have time to consider these important matters. Therefore I do not think it would be right for individual countries, as he would wish, to shoot off about the matter. That would be a most irresponsible course of action.

Sir. I. Gilmour: I believe that both the Americans and the Germans would have been extremely grateful for a lead from Her Majesty's Government. But they did not get it.
What is clear—I hope that the right hon. Gentleman agrees with me on this point—is that if the European countries allow themselves to be scared by the Russians into renouncing this weapon without securing genuine reciprocal concessions, that will continue a resounding victory for the Warsaw Pact.
Of course the neutron weapon will not obviate the need to build up NATO's conventional forces. That, too, must be done, only if the Soviet Union sees that her attempt to tip the military balance in her favour is not going to succeed will she abandon the attempt and agree to reduce her forces, and only then will Western Europe be secure.
Weakness does not produce security. This Government are weak and they have weakened this country. They have harmed NATO, and they have lessened the prospects of international disarmament. They have damaged our defences and the Armed Services. They cannot now undo that damage. They cannot now regain the confidence of the Services or the confidence of our allies. Only a Government who give defence its proper priority can do that.
The Conservative Government will pay our Service men properly. They will restore their status. They will foster their morale. They will see that Service men have enough good equipment, fuel, ammunition and spares with which to fight and train. They will deal honestly and fairly with our allies. Only a stronger Britain in a stronger NATO can bring security to Europe. Only a Conservative Government can begin to achieve those things.
I ask the House to reject the Government's motion and to support our amendment.

5.45 p.m.

Mr. Frank Allaun: Although it has not been called, I wish to support the view contained in the amendment signed by 75 hon. Members. Our amendment would leave out from 'House' to the end of the motion and add
'declines to take note of the White Paper because it provides for a real increase in arms spending, which will heighten world tension, divert resources urgently required for social needs, and contravenes Her Majesty's Government's election pledge to reduce military expenditure; urges the Government to give active

support to the proposals of the Lucas Aerospace and Vicker workers for deployment to alternative socially useful products; and reaffirms Labour's commitment not to proceed to a new generation of nuclear weapons.'
The arms race is getting out of control. It is like a coach taking mankind towards the precipice. Instead of applying the brakes, the drivers are accelerating.
There are fine words in the defence White Paper about the Government's disarmament proposals. They will remain little other than hypocrisy so long as the accompanying policy is to increase arms spending and develop new weaponry. That is a strange way to achieve disarmament and peace. The deeds contradict the words.
In the Government's expenditure plans for the next three years, just published, defence shows the largest increase for any Service. In that period annual arms spending is planned to rise by £371 million at constant prices. God knows what that increase will mean in terms of inflation. Of course we all want multilateral disarmament. But what hope is there of achieving it if we move in the opposite direction by increasing military preparations? As for the Conservative Opposition, their policies are still more dangerous. Their leaders bang the war drum more loudly still.
I wish now to make my main point. The White Paper makes much of Soviet military strength—which I like no more than American or any other military strength. But the threat to humanity is not the possibility of a Russian invasion. It is the arms race itself that is taking us all towards a nuclear war.
As the American C. Wright Mills said:
The immediate cause of World War 3 is the preparation for it.
The greatest task of our time is to stop it. We are being brainwashed by the war hawks who oppose detente and demand still greater arms spending When either East or West increases its military expenditure, it provides the other side with an excuse for expanding its expenditure.
The wild men have joined the
Soviet Threat of the Month Club
at the Pentagon, as Art Buchwald of the International Herald Tribune puts it. Each month they come up with a new Russian threat to justify spending more money on arms.
Some years ago, the Pentagon invented the missile gap, showing that they were behind the Warsaw Pact in nuclear missiles. That was in order to justify still greater American war preparations. Later, when Congress approval had been obtained, it transpired that the missile gap was a myth. It was America which produced the first atomic bombs, the first hydrogen bombs and the first Polaris and it is America which is now developing the first cruise, MX and neutron weapons. In each case, the Soviet Union has followed suit and no doubt will do so again if we are foolish enough to proceed to new horrors.
But, I repeat, it is the West which has been the pacemaker in the arms race. The initiative has come mainly from the Pentagon. If militarists hold that we can negotiate only from superior military strength, they can hardly blame the Russians for using the same argument.

Mr. Nicholas Fairbairn: Does the hon. Gentleman imagine that the Russians were not trying to develop these weapons and would not have done so but for the West? Does he argue that there is any likelihood of the West starting a war on purpose? Lastly, does he think that there is no chance of the Russians starting a war on purpose?

Mr. Allaun: The hon. and learned Member is dodging the point. The point is that he and his hon. Friends blame the Russians for making the running. Therefore, they say, we have to spend more money on arms. I am showing—and he has not answered the point—that, ever since 1945, it is the Americans who have forced the pace.
I see no reason for departing from the Labour Party's, and indeed the Government's, pledge to cut arms expenditure to the same proportion of gross national product as that of the other European NATO countries. Instead, we are increasing it in real terms, next year and subsequently.
The White Paper makes no decision about the 3 per cent. limit applying for more than two years, yet everyone knows that the insatiable Dr. Luns of NATO has demanded it for each of five years. Having given way for two years, who expects the Government then to change course—unless we can make them do so,

as I hope we can? We can only imagine what a gift of an argument is provided to the more hawkish of those in the Kremlin when NATO increases its arms spending by 15 per cent. in five years.
I am distinctly unenthusiastic about the military strength of Russia or any other country. In some weapons, the Warsaw Pact exceeds the capacity of NATO. However, in most weapons, as American and neutral sources testify, NATO is far more powerful.
For example, NATO has 18 aircraft carriers to Russia's one. The same dominance applies to the new weapons such as the cruise and MX missiles and the neutron bomb. As for manpower, according to the Institute of Strategic Studies—hardly a Communist institution—the Warsaw Pact countries have 4·7 million men in military service, and the NATO countries have 4·8 million. According to the same source, military expenditure by the West exceeds that of the East. In any case, both sides have enough nuclears to devastate their so-called enemies several times over.
I am sick to death of the daily propaganda for more arms spending. As Sean McBride, Nobel Peace Prize laureate, has said,
We should remember that the arms lobby is perhaps the best organised lobby in the world.
Let me give one or two examples. There have recently been at least seven major television programmes pressing the argument for greater NATO spending. Consider the articles in The Daily Telegraph—I sleep with it under my pillow. Of the first 279 issues last year, no fewer than 67 contained an article or leader attacking Russia or demanding more military preparations. That was on the leader page, the editorial page, alone.

Mr. Onslow: I shall not ask the hon. Gentleman, because if: would embarrass him, whether he can give the comparable figures for Pravda and Izvestia, although I dare say there has been a fairly regular flow of articles attacking the West in those journals. However, if he were to try to make the point in reverse in any public forum in Russia, he would almost certainly land in a lunatic asylum.

Mr. Allaun: Unfortunately, I cannot read Russian, but it seems probable to


me that similar propaganda is being issued in Russia. But that is no justification for our doing a dangerous thing.
I have just read a pamphlet written for the Air League by Sir Neil Cameron, Chief of the Defence Staff and Marshal of the RAF. A more tendentious and biased piece of propaganda it would be hard to find. It talks ad nauseam about the alleged Soviet military threat and the threat to the political values of the West. Military officers, like senior civil servants, are supposed to keep quiet in public about their political views. If a civil servant had breached the rules as Sir Neil has done, he would have been reprimanded or sacked.
I would also mention that dubious body—where its money comes from is not revealed—the Foreign Affairs Research Institute, which publishes a weekly diatribe against Russia written by Right-wing extremists. What is the aim of all this propaganda but to destroy detente, increase arms spending and bend men's minds to accept a third world war? I appeal to hon. Members not to play that game.
Fortunately, the anti-war ranks are beginning to emerge and grow. The Labour Party stands firm on its policy. The two-million-strong Transport and General Workers Union not only carried the policy at its biennial conference in July but also specially printed its lengthy resolution in the form of a 12-page pamphlet, similar in its line to that of the Labour Party's important book "Sense About Defence". I am happy to add that Moss Evans, the union's new General Secretary, actively supports that policy.
Then there are the Churches. Although I am not a Catholic, perhaps I might draw Members' attention to the current campaign by the Catholic bishops. In a joint pastoral letter read in all churches on 29th January this year, the bishops of England and Wales called for international disarmament. They declared:
Unless we bring about disarmament … we may well be bearing some moral responsibility for allowing the most terrible and overwhelming violence of nuclear war to become possible.
That letter, marking Peace Sunday, followed the publication of Pope Paul's New year message entitled:

No to Violence; Yes to Peace".
The front page headline in the Catholic Universe for 27th January read:
Disarmament—Act Now, say Bishops
Another item in the same issue states:
50,000 urge MP to vote for arms cut Canon Carson, administrator of Middles-borough Cathedral, has urged parishioners to write their local MP urging him
—note the words—
to vote for a cut in arms spending.
That is precisely our demand. I regard this drive by the Catholic Church and by other Churches as of vital importance and of great encouragement. The Labour Government must listen.
I have no love for the Kremlin, but the Government must take seriously the recent proposal by Mr. Brezhnev to stop the production of new weapons of mass destruction and then to reduce them. "Our policy", he declares,
is aimed at ending the arms race.
So far it has produced no response at all—just complete silence. It may be that Mr. Brezhnev is bluffing. Then put his offer to the test by serious negotiations with him.
The British disarmament proposals for the United Nations Special Session on Disarmament in May would be praiseworthy if, at the very same time, we were not increasing our arms spending, supporting the neutron bomb and proceeding with preliminary research into a medium-range missile of the cruise type, or at least the components for it, as the Secretary of State admitted to me in a recent parliamentary reply, to be found in columns 471 and 472 of the Official Report of 23rd January. How can he expect the Warsaw Pact Governments to regard our proposals as sincere or credible? So we must give an earnest of our good intentions by reducing arms spending, as the Government have pledged to do.
We ask the Labour Government to follow the policy of the Labour Party and, indeed, their own election commitments and to succumb no longer to the myths and pressures of the men of war.

6.2 p.m.

Mr. Hugh Fraser: It is always interesting to follow in debate the hon. Member for Salford, East (Mr. Allaun), who pursues his line with considerable consistency. But if he looks


at recent events he will find that the Power which has been holding up disarmament has undoubtedly been the Soviet Union.
The pilgrimage from Helsinki to Belgrade has been a pilgrimage of disgrace. The Vienna talks, having gone on for four and a half years, have ended in no results at all. The SALT agreements look like failing. I wish that the Catholic bishops—I am a Roman Catholic—read a little more of Mr. Suslov's pleas for a continuation of anti-Christian world revolution.
Who is taking action against peace in the world today? Who is taking action in Africa? Who is taking action against Catholics in Angola and in Mozambique? Who is taking action against Christians in Ethiopia and a few in Somalia? It is the Russians and the Cubans. I hope that some of my bishops will pay attention to those events, too.
Events in the world today reduce the White Paper to pitiable proportions. Not since the 1930s has the world been at greater risk of war. That is the level of debate that we should endeavour to pursue during these two days. It is unnecessary for me to compare this White Paper with other White Papers. The trouble is that British Government White Papers never take into proper consideration the defence programme for at least five years. Government after Government produce defence programmes which in the following year are cut. I hope that right hon. and hon. Members on both Front Benches will pay more attention to the American statement on defence which covers a five-year budget. Without a five-year defence budget, it is no wonder that the defence forces are in disarray and are discontented. Year after year Governments have cut what they promised to spend on the Armed Forces. Unless we have a proper five-year budget, the Armed Forces will always get hit and be put to the bottom of the Treasury queue.
I believe that this is an election year White Paper. Apparently, everything is well. It reminds me of the unfortunate Marshal Bazaine who, on the day before the French Army was routed and destroyed at Sedan, reported to Napoleon III "All is well, Imperial Majesty, down to the last trouser button". That is the kind of White Paper that we have today.
I believe that matters of defence are so serious that we need a five-year period of control of defence expenditure. Therefore, we need a Select Committee on Defence which remains in permanent session. If we merely have odd days to debate defence and Questions which are always parried by Ministers—I have been a Minister in the past—we shall get no continuity. The House and the Armed Forces need, but have not had, such continuity.
I do not want to speak for long about the threat, but it is bad for four reasons. First, the threat is worse today than it has ever been because of the failure of the disarmament conferences. Secondly, the threat is worse today than it has ever been because of the increase in military forces by the Soviet Union.
The other two factors, which are not referred to in the White Paper, because it takes a very narrow view of the issue, are as dangerous as any. I refer to the fact that stability in Western Europe and the power of the nuclear bomb and its use have completely changed over the last 15 years.
Peace in Europe has, in the past, depended on two major facts. The first is that on each side of the Iron Curtain there was stability. It may have been a horrible, revolting, ghastly stability on the eastern side of the frontier, but on our side there was comparative stability. However, today that stability is in the balance. Already there are signs of instability in Eastern Germany. Great changes are taking place in Western Europe. There is Euro-Communism and all the other movements, changes in constitutions, and there is no longer the certainty of stability in Yugoslavia.
The second great change is that, whether it be a new tactical nuclear weapon—what used to be called the Davy Crockett bomb, the airborne carried bomb or the neutron bomb—such weapons are under the lock and key of American Forces. But the Americans are losing some of the enthusiams that they used to have for fear of possibly bursting a nuclear holocaust upon their own people by protecting Europe with nuclear weapons. It is time that this House and the Defence Department admitted that there is that change and adjusted their policies accordingly.
I used to be Secretary of State for Air. I recall the war games and TEWTs with tactical nuclear bombs being thrown in. They never made much sense. These are now nonsense concepts because there is no certainty that tactical nuclear weapons will be used.
We need a totally new look at defence. For nearly 30 years we have been pursuing the same policies and producing much the same sort of White Paper. Is it not now time to take into consideration the various changes that have come upon Europe and upon the tactics and technicalities of defence in the last third of the century?
There are a number of matters that must be faced and dealt with by the House, whatever party is in power. We must review what our real commitments are and what they should be. It is clear from the report by Mr. Brown, the United States Secretary of Defence, that a struggle is developing—not the famous battle for Europe, but a struggle for finite raw materials throughout the Western world. This is a development on which we should have a policy.
We must bear in mind that the great set battle of the Rhine Army may not take place. Has the Secretary of State noticed that in the last three years three more Russian airborne divisions have been established and that the air fleet has been increased to 2,000 uncommitted transport planes? Yet, in the face of this, there are no proposals for the defence of this country in the event of war. It must be known to the Secretary of State that NATO is not committed to the defence of this country with ground forces any more than it is committed to the defence of the territory of France.
The next question that we have to decide is what we should afford to spend on defence. There has been much talk about proportions of our gross domestic product, but this is one of the most absurd concepts I have ever heard. For all we know, some hon. Members opposite may come to power and bring about the dream of Nebuchadnezzar so that the population is eating grass. What would our gross domestic product be then?
The level of defence should be the level of military need and that means that we must spend roughly the same per

capita as is spent by the Norwegians and the French. If I may have the attention of my colleagues on the Opposition Front Bench, let me point out to them that this would mean increasing our defence expenditure between £1,200 million and £1,400 million. That is a minimum requirement.
The next question to be considered is manpower. If there is no certainty about the use of tactical nuclear weapons, there must be a revision of manpower requirements. When the red light starts winking and the danger signals go on, the Prime Minister will have to decide whether to send 70 per cent. of our reserves to Rhine Army or whether to hold them back. Does he leave this country with 50,000 reservists and send our forces to Rhine Army or does he betray Rhine Army? It is an almost insoluble question, but. unless we have more forces, the Prime Minister may be faced with having to make that decision.
A Select Committee must look into the numbers that are required. I believe that that it would find that even on the basis of only our present commitments there should be 220,000 effective soldiers instead of our present 160,000, and 300,000 men on reserve instead of our present 130,000—which is only about half of the numbers available to France and only one-third or one-quarter of those on call in Germany.
These forces cannot be produced by a voluntary system. Such reserves could not be produced by a return to the old-fashioned Home Guard or the Territorial Army because it takes a year to train a man in the use of precision weapons. The House must look again at some form of National Service. That is why it is important that we should set up a permanent all-party Committee to review the position of our forces.
Of course, many people will oppose National Service, including industrialists, many politicians, school teachers, and so on. But many young men would prefer to be in the Armed Forces than in the dustbins portrayed in advertisements by the Manpower Services Commission. When we consider how much money is being wasted in the creation of non-existent jobs—and it totals nearly £1,000 million—this is a question which must be considered. There is something to be said for the young regarding the State not just a a machine which, on call, will


produce assistance to its citizens, but as an entity to which its citizens have an obligation.
These are matters for the House to consider. I warn hon. Members that seldom before has the world situation been more dangerous and there has never been a greater need for the House to study these matters. Today, we cannot rely on suddenly putting things right in an emergency. The House must consider these matters because the situation could get much worse in the next few years.
It takes eight years to bring modern weapons into service and about 18 months to establish cadres. It takes more than a year to train men in precision weapons. As Mr. Brown rightly said, it is a myth to believe that defects can be put right quickly. It will fall to the Conservative Party when it wins the next General Election to ensure that these improvements are brought into effect and it is for the House to ensure that a permanent Select Committee is established to keep the Government of the day up to the mark in maintaining the defences of our country.

6.19 p.m.

Mr. J. P. W. Mallalieu: A sensible suggestion about defence debates was made recently in another place. It was that we should split the debates into two. One would deal with defence policy, along the lines taken by the right hon. Member for Stafford and Stone (Mr. Fraser), and dealing with our commitments, the possible imminence of any threat, the adequacy of our expenditure and the extent to which that was threatening our economic welfare.
I agree with some of the comments of the right hon. Member for Stafford and Stone, but I profoundly disagree with his suggestion of a return to National Service. I am surprised that among the people that he listed as opponents of the idea he did not include the Armed Forces. In my experience, they do not want National Service.
The second half of the debate on defence would deal with welfare. It would deal with the conditions under which our Service men and women work, live and operate. It would deal with their quarters, recreational facilities, opportunities for promotion and for accompanied service. It would also deal with Service pay and food. I hope that

the Govermnent and the House will consider that suggestion. If they do not we shall continue to have confused debates I am aware that policy and Service welfare cannot be separated entirely. If conditions are not good we shall not achieve the recruitment that is needed and that will have an effect on the total size of the forces. However, defence policy and defence welfare are sufficiently distnguishable and sufficiently important to merit separate consideration by the House.
I shall deal exclusively with the second half of the defence debate—welfare. Usually I do not consider important much of what I read in The Daily Telegraph. It always seems to be a Poujadiste fun sheet—a type of Private Eye for the lower middle classes. Nor have I been all that impressed with the kind of stuff that I have heard for the last three years from the right hon. Member for Chesham and Amersham (Sir I. Gilmour). I have often thought that his speeches contain too much flippancy and trivia. He and The Daily Telegraph spread the stupid myth that the Labour Party, the Labour movement and the Labour Government do not care about defence and Service men. I thought that that did not really matter because no one took any notice, until I read of an incident which took place only a few weeks ago. That was the extraordinary and shocking performance by senior officers in the Army at the Adjutant-General's meeting who stamped their feet, heckled and booed their own Service Minister.

Mr. Jerry Wiggin: That is not surprising.

Mr. Mallalieu: It was the most shocking thing that I have heard of, except for the performance of the police when, as we saw on television, they hurled abuse and hammered on the Home Secretary's car, exactly like the half drunken hooligans at football grounds whom they are supposed to keep in check.
The hon. Member for Weston-super-Mare (Mr. Wiggin) said that it was not surprising that senior officers should behave in this way. I now think that he is right. It is not surprising if they believe the mischievous stuff that is put about on the Government's attitude to the Armed Forces. I know a great deal more about the Labour Party's attitude to the Forces of the Crown than the hon.


Member. I know a great deal more about the history, conditions and treatment of Service men during the past 30 or 40 years.

Mr. Wiggin: I am not surprised at the behaviour of the officers, although I do not condone it. Who can blame them when their own Minister stands in the Grunwick picket line? That is the example that they were following.

Mr. Mallalieu: It was not. They were booing their Army Minister who was telling them that they, like everyone else, must be prepared to accept some restriction on pay. It was a most discreditable incident.
I said that I knew more about the history of the treatment of Service men than the hon. Member for Weston-super-Mare. In order to justify that statement I shall go back to the first Service debate in which I took part 33 years ago. I do not have Hansard with me, but I have a book by Hannen Swaffer entitled "What Would Nelson Do?" It was partly written by George Hutchinson, who was, until recently, one of The Times columnists. The book comprises a series of interviews with long-serving Service men. It tells of their experiences and of their complaints about treatment, pay and conditions before the war. The Labour Party could not possibly be held responsible for that period.
The book contains a quote from a good friend of mine who used to be a Conservative Member of Parliament, Commander Noble. When referring to the conditions suffered by Service men he quoted an old and bitter piece of verse:
God and our soldiers we adore,
When danger threatens;
not before.
That was true in all the years before the war.
In this first debate when the war was over many young and new hon. Members who had been in the Services and who knew about the conditions came to the House and protested. I remember telling the House of some of the conditions that I had experienced. Some of them were rather trivial. I talked about the recreational facilities at Scapa when the Fleet came in. Those facilities comprised two tin huts, one of which was full of smoke, broken glasses and totally undrinkable

beer. The other was an alleged cinema with two projectors. When one projector was on we could see and when the other was on we could hear. If we wanted to know what the film was about, we had to go in twice.
I remember talking of the conditions in the barracks where the hammocks were wedged so closely together that if one sneezed one was in danger of breaking the rib of the man in the next hammock. I told the House of being sent to the Arctic with an open gun shield. Not only did the guns freeze, but so did the men.
Those were the sort of conditions that I was protesting about in that debate. Shortly afterwards I was followed by a colleague who had been through the war who said that the trouble with the Navy in the past had been that it was run by technicians who thought of getting good equipment but who never bothered about the men who were going to work it. He told the Admiralty very clearly that it had to change. That colleague is now the Prime Minister.
At the end of the debate, after strong protests from all sides, we obtained from the Government a definite assurance that while Service men, particularly sailors at sea, could not expect to have the total comforts they would have at home, at least they had the right to be assured that they would have, in efficient ships, the most comfortable conditions possible. The Government gave the pledge that they would provide them.
My right hon. Friend the Prime Minister went from the Back Benches to the Admiralty as a junior Minister and began to carry out what he had been preaching below the Gangway. From that time on it has been firmly established that the living conditions and the comfort of the men who serve in our Armed Forces are to be of paramount importance. That goes for pay as well.
I wish that this debate had been taking place in a week or two's time when we shall have had the results of the review. I do not know what those results will be, but I say to my right hon. and hon. Friends now, as I said to the then Ministers 30 years ago from roughly the same position in which I now stand, that although we and the Services know that they have to be bound by the same sort


of restrictions as apply to the rest of us, when it comes to pay increases there could well be a case for making Service men, or some of them, a very special case.
I am thinking for the moment, not of my beloved Navy, but mainly of the Army fighting in Northern Ireland. Service men are not fighting an ordinary war there. They are fighting something infinitely worse. They are fighting a war in a civilian ambience. They do not know who their enemy is and they are subject to restrictions that in a conventional war Service men would not have to adhere to. They have to suffer all sorts of things that may be trivial to some of them but which to me are terrible. There is the appalling spectacle of ghastly kids in the streets throwing stones and hurling abuse. The soldiers stand there taking it, unable to do what I should like to do, which is to beat the living daylights out of them. Those people are due for treatment as a special case.
I believe that everyone in the Services has the right to expect at least the same treatment as is being offered to the firemen, that is, a commitment that at a future date the anomalies will be put right and the present lack of comparability corrected. I very much hope that the Government will do that.
As we have seen, there are people in my party who wish to see defence expenditure cut. Year after year my hon. Friend the Member for Salford, East (Mr. Allaun) makes a speech. We can usually take it as read, and I wish sometimes that we did. But my hon. Friend and his colleagues have always said that, while they want defence expenditure to be reduced, they do not want that reduction to be made at the expense of the men and women in the Armed Forces. My hon. Friend is a gallant fighter against slums and a gallant fighter for better housing. That fight he carries on not only for civilians but for the people in the Armed Forces.
Those of us who experienced the Forces—all the older ones—have never forgotten it. We have remained absolutely determined that the men in the Armed Forces shall receive the proper treatment that is their due. We have not only made sure that we continue to remember it; we have made sure that our younger colleagues remember it, too.
I believe that the pressures we began to exert in 1945 have on the whole been successful. I shall not be so ignorant or so mean-minded as to suggest that all the improvements that have taken place compared with before the war have been due to the Labour Government. I know that is not true. I know that we put on the pressure because our Government were in power, but I know that that pressure has been carried through to the present day.
I should like to recall one more event from long ago. This is probably the last speech on defence that I shall ever make in this House and I should like to finish it with the same words as I used to finish my first speech on defence all those years ago. I said:
To this Labour Government"—
this was early in 1946—
I would say they ought, by now, to be establishing, as a fundamental principle, that in any undertaking the human beings who take part should be a first charge. Putting my appeal more widely,"—
I carried on—
I would say to every Member of this House who has ever been in any of the Services that we ought to insist that this Government and its successors shall see to it that the seamen of Britain, of whom everyone is so proud, shall be allowed to live and shall be treated as human beings."—[Official Report, 3rd April 1946; Vol. 421, c. 1280.]
Those were my last words in my first speech on defence. I think they were jolly good words, and I add to them only that besides seamen I am talking about airmen and soldiers. I am glad to have played some part in seeing that those words were fulfilled, and I am proud as a Member of the House of Commons to realise that people of all parties have gone out of their way consistently over the past 30 years, in spite of the stupid and mischievous sneers that have sometimes been made against my side of the House, to make sure that Service men and women in their undertaking are a first charge.

6.40 p.m.

Colonel Sir Harwood Harrison: I shall not follow up the speech made 30 years ago by the hon. Member for Hud-dersfield, East (Mr. Mallalieu). I am afraid that I was not a Member of the House at that time. I have now heard bits of that speech, and it sounds as though it was very good.
I think that it is fair to say that this year's White Paper contain little that is new. That is not necessarily a criticism, as it is only three years since we had a major defence review, and frequent upheavals are not good for the Forces, nor for the morale of Service men. Stability in defence policy can, therefore, be valuable in its own right.
However, we cannot afford to ignore political and military developments in the rest of the world. We can judge the effectiveness and the capability of our Armed Forces only against the threat that they are designed to confront.
It is worth noticing in this context the wording of the White Paper itself, which speaks of the capability of the Warsaw Pact forces as "formidable and growing". The White Paper goes on to warn us that Soviet forces have been strengthened both qualitatively and quantitatively
on a scale which goes well beyond the need of any purely defensive posture.
I have heard it said by a high-ranking officer that the country that arms itself beyond what is required for its defence sooner or later likes to exercise that power. That is a very sobering thought. I can see nothing in this White Paper which says what we shall do to counteract the Soviet threat.
There have been criticisms in some quarters of the Government's decision to include the French Atlantic fleet and French forces stationed in West Germany in the assessment of the current military balance. I do not see anything objectionable or sinister about this. Certainly the Government have made no secret of this device. It is clearly signposted both in the text of the White Paper and in its footnotes.
In my view, there is a good case for counting the French forces, which, whilst not formally committed to NATO's integrated military command structure, could reasonably be expected to support the Alliance in the event of Soviet aggression. Indeed, it might be argued that the French would be rather more loyal and reliable partners than some of the Soviet satellite countries in the Warsaw Pact.
However, even allowing for that, it is worth noting that the imbalance in favour of the Warsaw Pact in artillery, tanks and tactical aircraft is of the fantastic order of 2½:1 in each case.
The White Paper sees particular cause for concern in two developments over recent years: the state of readiness of the Warsaw Pact forces, and the introduction of a range of sophisticated new equipment, including new classes of missile-carrying submarine, the Backfire bomber and the Kiev class of aircraft carrier.
Soviet ground forces have received new tanks and helicopters and a range of advanced missiles, but it is perhaps the question of comparative readiness of NATO and Warsaw Pact forces that gives the most cause for anxiety. The White Paper stresses the improvements that the Warsaw Pact forces have made in the last two or three years in their capability to move men and equipment forward to the front line in large numbers. My own Sub-Committee—the Defence and External Affairs Sub-Committee—also drew attention to this worrying trend in our report on reserves and reinforcements, which was mentioned earlier and published last summer.
In that report we pointed out the difficulty of getting our reserves to take their place in the front line before war is actually declared. We are always told, whenever we ask any official from the Ministry of Defence, that there will be a time of tension and that it will be long enough to get our reserves, which include the TAVR, to the front line and to their battle positions in time. Many assumptions have been made on this basis of their getting there.
We expressed our anxiety at the Warsaw Pact's increasing potential for delivering a surprise attack without the normal preparatory warning signs of large troop movements. We reported that the Ministry of Defence has contingency plans for meeting such a surprise attack, although for obvious reasons we did not elaborate further.
However, I hope that tonight the Minister, at least within the limitations of security, will assure the House that the counter measures to deal with a surprise attack are constantly reviewed to match the Warsaw Pact's enhanced capabilities. I think that this is most important. Perhaps the Minister could say a little more about how the Government intend to fulfil the undertaking made last May at the meeting of NATO Heads of Government to improve the readiness


and reinforcement capability of the Alliance.
These matters are absolutely crucial, since it is only by maintaining a strong and, above all, credible conventional deterrent posture that we can keep the nuclear threshold high. Nor is it necessary to believe that an attack will come tomorrow in order to view present developments seriously. For what will surely, more than anything else, make an attack on the West seem tempting is any sign by some of our allies that they have lost the political will to keep up their defences and to keep them in good order.
I want to make one comment to everyone in the House and, through them, to everyone in the country, and that is to ask them if they will please recognise the invaluable task that all our Services are doing to keep the peace of the world. I ask that, when any man comes home on leave to his village or town, he should be congratulated by all who see him and should be told that it is because he is ready and is doing a good job, being armed and alert, that we are able to keep the peace of the world that we all desire.
I turn to another aspect of the debate—expenditure on defence. In the Second Report of the Expenditure Committee of last Session, we criticised the Government for the succession of cuts in defence spending since the defence review and drew attention to the damaging cumulative effect that these cuts are having on the front-line capability of our Forces. Since then, in response to the call by NATO for measures to improve the defence of the Alliance, the Government have announced that spending on defence in 1979–80 will be increased by 3 per cent. in real terms compared with the figure for 1978–79.
This announcement is welcome as far as it goes, but it is important for us to be clear about what it involves. In effect, even with this 3 per cent. increase over 1978–79, spending for 1979–80 will still be some £55 million less at constant 1977 prices than was orginally planned. In other words, before we get too carried away, we should remember that expenditure in 1979–80 will still be less than the figure for that year which resulted from the series of cuts that we criticised in our report last year.
Therefore, though I welcome the 3 per cent. increase, the Government must realise that they still have some way to go before they can claim to have restored our defences to their level of three years ago.
Usually in the debate I like to say something briefly on the work of my Sub-Committee over the last year. Its main inquiry was on the subject of reserves and reinforcements, to which I have already referred. I do not wish to go over that again, important as it is, save to stress the importance which my Sub-Committee and I attach to the TAVR and the crucial necessity for it to arrive on the Continent in time to carry out its reinforcing role effectively. We have had the honour of inspecting some excellent units of the TAVR and we have been hoping to go, as a Committee, this week to the North-East in which area there are more TAVR units than anywhere else in England. I hope that this visit will only be deferred.
I do not think that everyone realises his commitment. A boy may be ploughing a field one day of working in a factory or in an office, and a week later a frontline soldier. This is a new commitment and was not one which was accepted by the old Territorial Army. It is a rather frightening prospect. However, one very good aspect of all this is that those units which are marked for overseas service are getting very good equipment. They are getting equipment that is a great deal better than we got in 1939, as I know to my cost Nothing makes a unit better than receiving all the up-to-date equipment. I hope that we shall be able to transport it by air or sea to its allotted position.
We have a longer passage by sea now because France is not in NATO and we cannot plan on the assumption that she will be with us. We sincerely hope that she will be, but we do not know at the moment. We now await the observations of the Minister of Defence on our report, which made some criticism of the call out and mobilisation procedures. My Sub-Committee will wish to examine the Ministry of Defence in some detail on these matters during the next couple of months. We shall also be visiting British forces in Germany during April and we


shall be interested to hear how the fighting units on the ground are coping with some of these problems.

Mr. Wiggin: The report of my hon. and gallant Friend's Sub-Committee was published on 19th May 1977. Is it not reasonable to expect that the Ministry should by now have sent my hon. and gallant Friend a full and fair answer to the excellent points which his Sub-Committee made?

Sir H. Harrison: One cannot always know the ways of Ministers and Departments. I was referring generally to one or two reports that we wish to see. There are reports on matters other than this one in particular.

Mr. Mulley: In case hon. Members do not realise it, the reply has been sent already, and it is Cmnd. 7011.

Sir H. Harrison: I thank the Secretary of State for coming to my aid. My Committee and I were concerned with the TAVR and very keen that the Prime Minister should lend his authority to the annual recruitment campaign by making a public statement of support for the role and importance of the TAVR. I was glad, therefore, to see such a statement made in a recent Written Answer. However, without wishing to sound grudging, I must say that I think that it would have been more effective and weighty, if there had been some expression of support by the Prime Minister in one of his many public speeches.
I should like to summarise some of the other work of the Committee during the past year. We have visited regular and TAVR units in the West Country and we have seen the Military Vehicle Engineering Establishment at Chobham, and hope to make a short report to the House on the Chieftain tank engine.
We have looked at the question of the joint training of Service men and now await—I think I am right in saying that we still await—

Mr. Doug Hoyle: That is a bit cheeky coming from the hon. and gallant Member.

Mr. Wiggin: Does the hon. Gentleman wish to intervene?

Mr. Hoyle: We do not need cheap jibes from the Tory Benches in a serious debate.

Sir H. Harrison: I was not making a cheap jibe. I thanked the Secretary of State for coming to my rescue before, and I simply said that I thought we had not had a reply to this later report.
We have also examined the implications for defence of the large commitment placed on us by the Foreign Office, which has taken us off our defence map. If I am left with anything in my mind, it is and it will always remain, the killing power of missiles. I would always support missiles more than anything else.
I am very satisfied with the general morale of all our Services—or at least I should say that I was satisfied. But there has come into the question the devaluation of our money and what this means to the soldier's wife who may be abroad for the first time and not at home, and therefore at a loss to know how things should go. When pay is considered by the Ministers, they should make certain that what is given to Service men with one hand is not taken away with another in charging more for food, rent, and so on. In some cases last time a man was left with only 3p a day increase.
I have seen some of the preparations that have taken place on our northern flank. I am sure that there is a great desire by countries such as Norway and Denmark to give a good account of themselves. As far as we are able, we must support them up to the hilt. We have some commandos going out and training in Norway and fraternising with the local people. I always feel that it would be a grave disaster if, when the war came, they were not sent out to this area where they have got to know the people and the land well, but sent instead to, say, North Africa—it may be very important—or somewhere else.
The White Paper will be read, as usual, by our allies and our enemies. What worries me is that they will think, rightly, that the Government have been too complacent. What shall we do against increased Russian rearmament? The British people have a right to know the answer. They would be prepared to give us something if they knew that their way of life was to be more secure.

7.0 p.m.

Mr. John Roper: It gives me great pleasure to follow in debate the hon. and gallant Member for Eye (Sir H. Harrison). Having served under his chairmanship of the Defence and External Affairs Sub-Committee since 1974, I know that he has always been a non-partisan Chairman. His work has been much appreciated. I thought that it was unfair of his right hon. Friend the Member for Stafford and Stone (Mr. Fraser) to suggest that we did not have a defence committee of this House. The hon. and gallant Member has done a great deal towards helping our understanding of defence matters. He knows that I have not always agreed with him on all matters, but I am grateful for the way in which he has conducted the affairs of the Sub-Committee.
My hon. Friend the Member for Hud-dersfield, East (Mr. Mallalieu) said that his speech today may well be his last in a defence debate. The same is probably true of the hon. and gallant Member for Eyre. Both hon. Members will be missed in this House in future when we discuss defence matters. My hon. Friend the Member for Huddersfield, East has left a heavy charge on those of us who may remain Members after the next General Election to continue the concern which he has shown for so long for the welfare of Service men and women. We shall do our best to follow the lead that he has given us.
In all years we have a general problem in considering Defence Estimates because, as was said by the right hon. Member for Stafford and Stone, we are considering annual Estimates, but in any one year the freedom of decision open to my right hon. Friend the Secretary of State or to any other Minister is extremely limited. We all know that for the most part decisions on defence expenditure made in the current year will have little effect, either for good or bad, in that year. They will have their impact in five years, 10 years or perhaps 15 years. That is why there are arguments, not necessarily irrefutable, in favour of publishing the long-term costings which are prepared in the Ministry of Defence so that we can consider them along with the annual defence White Paper.
I should like to consider the White Paper in the longer-term context, looking

back over the past 10 years to 15 years and looking to decisions with which we shall be faced in the next 10 years to 15 years. After all the argument that has gone on today and in the past on defence expenditure, one of the most surprising things, if we look at expenditure in real terms, is that defence expenditure has been remarkably consistent over the past 10 years. Lord Winterbottom gave an interesting reply in the House of Lords just before Christmas showing that in real terms defence spending between 1969–70 and 1979–80 varied by little more than 2½ per cent., with a constant figure of about £6 billion in 1977 survey terms. It is extraordinary that there should have been such consistency over that decade.
If we go back further, to the 1960s, we find a fairly flat period of spending except for the "gear change" about 1969–70 when there was a reduction of about 10 per cent. following the consequences of the last Labour Government's decision about east of Suez.
We have had a consistency in the level of defence spending over about 10 years, but this has masked two important factors. One has been the increasing cost of new equipment and, therefore, its share in total defence costs and, as a necessary concomitant to that, the reduction in the number of men in the Armed Forces. The Navy is down from 100,000 men in 1960 to 75,000 men, while the figures for the Army show a reduction from 260,000 to 160,000, with the number in the Royal Air Force being virtually halved, from 165,000 to 85,000. This reduction—and this is not a party point—has proceeded fairly smoothly over a period during which both parties have been in power.
The other factor which has occurred over this period when we have had stability in the level of real spending on defence has been the reorientation of our forces towards our NATO commitments. If we look at the period for which the Ministry of Defence has provided us with the functional analyses—unfortunately, these go back only to 1965 and in the first year, 1965–66, the functional analysis was somewhat rudimentary—we see, as in Annex B of the current White Paper, that our defence expenditure can be divided into two broad categories. The top half might be called the teeth of the defence budget. This takes about half of our


defence expenditure and includes such matters as the nuclear strategic force and the combat forces. The tail, or support services, make up the other half of defence expenditure. Again, if we look at the period since 1965, when expenditure has remained roughly constant in real terms, we see that the division between the top part, the teeth, and the bottom part, the tail, has remained, apparently reasonably constant.
If we look at this matter in more detail we see that there have been significant changes over the 15 years which have important lessons for defence decisions in the future. As the recent and valuable study by the University of Aberdeen's centre for defence studies has shown, there have been considerable changes in the expenditure allocated to the various combat arms. This has been masked by the apparent constancy in total expenditure. We have seen the reorientation of the spending of our Armed Forces, moving from the world role which existed in the early 1960s to a role in which we are concentrating attention upon the NATO commitments of the North-East Atlantic and the central front. Expenditure on the Navy is taking roughly the same real resources today as in the mid-1960s. Those resources, instead of being spread world-wide, are now concentrated in the North-East Atlantic and are concerned with much more limited geographical responsibilities.
We have been able to afford more expensive ships for our Navy in the North-East Atlantic because we have reduced the number of ships and we have also reduced the area we are trying to cover. This reorientation towards NATO can be seen even more clearly if we turn from the Navy to the Army's combat forces. Again, in real terms the resources allocated to what are described in Annex B as "European theatre ground forces" and "other Army combat forces" have remained broadly constant in real terms since the mid-1960s. The difference, however, is that in 1965–66 a third of the total expenditure on the Army was spent outside the United Kingdom and BAOR, whereas in Annex B we see that next year only 5 per cent. of our spending will be outside BAOR and the United Kingdom.
To put this proposition in another way, although the numbers in BAOR have remained the same since the mid-1960s, our spending to pay and equip the troops in BAOR has nearly doubled in real terms between 1965–66 and the date for the figures in the latest White Paper. There is an increase of about 70 per cent. Year by year, as a result of this increased spending in BAOR, we are packing a heavier punch in our forces in Central Europe.
Also—I come now to the Royal Air Force—it has been possible here to spend more on the tactical air force in Central Europe because we have been able to reduce commitments in the rest of the world, and, in particular, we have taken out the significant expenditure on air mobility which was required in the late 1960s for our extra-European commitments.
Again, looking at the long-term picture and casting our minds back to the mid-1960s, we see that our nuclear strategic force is now costing in real terms only one-quarter what it cost in the mid-1960s, but, before any debate begins about the replacement of that by another force, we have to realise that a new generation of nuclear weapons, if it were desired, would mean that there would once again have to be a considerable increase in our spending on the strategic nuclear force, and this would have to come either out of an overall increase of defence expenditure or out of one of the other arms. That also must be taken into account.
The conclusion which I draw is that over the past 15 years, while maintaining the level of expenditure constant throughout this period, we have been able to concentrate resources effectively in the Navy in the North-East Atlantic and in the Army and the Royal Air Force in the central front. We have been able, as it were, to squeeze the other parts of the defence budget—the rest of the world—in order to provide a significant growth in the resources available for those two central NATO commitments.
But that potential for increasing expenditure in our commitments to NATO has now disappeared. We cannot continue increasing the amount of money for BAOR by running down our commitments elsewhere in the world because


there are virtually no more commitments to run down. It will not be possible in the 1970s and 1980s to continue to increase, effectively, by 4 per cent. per annum in real terms the spending on BAOR as a result of saving money east of Suez and in the Gulf because there are no forces left to run down.
This, therefore, presents us with a considerable problem over the next 10 to 15 years. It seems to me that if we are to be faced with ever more expensive technology and ever more sophisticated weapons—my right hon. Friend the Secretary of State referred to this in his speech—we are faced with a dilemma which can be solved in one of three ways. I shall deal with them in reverse order of desirability.
First, we could agree that over the next decade the amount which we spent on defence would increase in real terms by about 40 per cent. to 50 per cent. That would be the implication of increasing by 4 per cent. per annum our defence spending over 10 years. That would be the implication if we were to continue over the next 10 years the sort of increase in real terms which we have given to BAOR over the past 10 years. But in the light of the remarkable constancy in defence expenditure which has occurred over the past 20 years, irrespective of party, that is something which I do not believe is likely to occur, even if there has been some increase offered in this White Paper.
The second possible solution, it seems to me, would be a further re-examination of our current roles and commitments. I believe that this will require the most careful analysis within each of the Services and across the three Services, as well as with our NATO partners, of the implications for our tactical doctrine and for our organisation of the technological developments which have occurred in recent years. Clearly, this should be linked with an assessment of the implications for our defence posture of the current strategic assumptions about what length of war we expect, what sort of notice we expect, and so on.
New technology, unfortunately, rarely saves money in defence. It certainly does not if all that is done when new technology comes along is to substitute more efficient weapons for old ones. It will be of value in leading us to make econo-

mies in the way in which we organise our Forces only if we are prepared to alter our doctrine and organisation to make the best use of it.
That, in turn, will require awkward and uncomfortable re-examinations in all three Services. I remember that my hon. Friend the Member for Hornchurch (Mr. Williams) made some suggestions about that in the defence debate last year. I hope that my right hon. and hon. Friends will ensure that this awkward and uncomfortable re-examination of tactical doctrine and organisation is not inhibited by the bureaucratic inertia and inter-Service rivalry which are said on occasion to occur within the Ministry of Defence. Of course, that may be pure rumour and speculation, but I hope that my right hon. and hon. Friends will ensure that it does not occur.
I hope that, when we consider the individual Services in the days after Easter devoted to them, we shall be able to pursue in rather more detail in each case the opportunities which may or may not exist in the future for taking advantage of technological developments to restructure and reorganise the missions and roles of the individual Services.
I come now to the third solution. I believe that we ought to be able to resolve the problem of increased resources required for defence, and in the most direct and positive way, by reaching agreement on an effective multilateral disarmament measure. Admittedly, the prospects for such a disarmament agreement have not been enhanced by the lack of substantial progress at the Belgrade conference. Many of us were sorry that there was no progress, in particular, on aspects of confidence-building measures which might have provided a basis for some advance. But the fact that Belgrade has failed seems to me to make the need for renewed efforts, both at the United Nations special session on disarmament in May and June and in Vienna in the MBFR discussions, that much more important.
I greatly welcome the proposals which my right hon. Friend the Foreign Secretary has put forward at the United Nations, but I believe that it is progress at the MBFR negotiations which is of critical importance for our defence commitments. I was glad to hear my right hon. Friend the Secretary of State say


that he hoped that there might be some progress on questions of defining force levels within the next few days. However, as Helmut Schmidt, in the speech quoted by the right hon. Member for Chesham and Amersham (Sir J. Gilmour), said last year when he was in London, with reference to the MBFR negotiations:
For the first time in history, those negotiations are being conducted at a time when there exist weapons capable of destroying all living things. Unlike former times, failure of such negotiations can no longer be compensated by banking on military victory. That is why it is of such crucial importance that all should realise the seriousness of the Vienna negotiations, and that is why results must be achieved there.
I am very impressed when I visit Bonn by the concern which the German Government and the Chancellor himself give to the negotiations in Vienna. I hope that the negotiations are being given as high a priority in Whitehall as they are being given in Bonn. Success in such negotiations and the obtaining of a properly controlled agreement would greatly increase stability in Europe while enabling us to make considerable savings on the Estimates which we are today considering.
We know that success is difficult to achieve, but that must be as firm an objective of policy for our Government as is our commitment to a secure defence of Britain in the face of a growing threat.

Several Hon. Members: rose—

Mr. Deputy Speaker (Mr. Oscar Murton): It is only fair to the House to say that a large number of right hon. and hon. Members are desirous of taking part in this debate, and reasonable brevity would be helpful to all.

7.19 p.m.

Mr. Julian Amery: The hon. Member for Farn-worth (Mr. Roper) concluded by stressing the importance of reaching disarmament agreements. I think that the whole House would agree with him that if they are properly controlled and reciprocal there is everything to be said for going ahead with them. But over the door which leads into the main conference chamber of the Palace of Nations in Geneva are inscribed the words of Lord Robert Cecil: "Disarm or perish." Those words were

interpreted unilaterally between the wars. We disarmed, and we damned nearly perished, so this time let us be careful to see that it is a mutual and reciprocal process.
The hon. Gentleman talked about defence expenditure over the next 10 years. I only hope that we have 10 years. I am not so sure. Having watched the defence scene from several posts in Whitehall, and having been in the House for more than 27 years, I have a feeling that we are getting very near, nearer than we have been at any time since the war, to the point of no return.
My right hon. Friend the Member for Chesham and Amersham (Sir I. Gilmour) put his finger on the problem when he said that the White Paper revealed a Maginot Line mentality. Of course, it is right that we should concentrate on the defence of Europe and the NATO area. That is where our life is at stake, where the immediate threat to our survival arises. Unless that line is held, there is nothing to be preserved.
But the threat does not come only from the Warsaw Pact forces aligned against us in Europe. In the last war we faced the danger of invasion but the greatest danger came from the U-boat blockade. The oil crisis through which we have lived since 1973 should have taught us some lessons. It brought about not only serious social and economic dislocation in our countries but serious political and defence complications.
The defence cuts made by this Government, cuts which we have been attacking, have been justified by and predicated upon the economic crisis resulting from the oil recession. The political developments in Italy and France also have, to some extent at least, their origin in that crisis.
By and large, the producers of raw materials, whether the oil producers or the producers of minerals in Southern Africa, have been well disposed to the West. But suppose our sources of oil, on which every war machine as well as every industrial machine depends, and the minerals, on which our armaments industry as well as other sectors of our economy depend, were to fall into hostile hands.
The supposition is not all that remarkable when one thinks that in Angola and


Mozambique the Soviets are within easy striking range of the minerals of Southern Africa, and in the Horn of Africa and Aden they are in easy reach of the oil of the Gulf. Suppose these sources of vital raw materials were to come into hostile hands. The survival of Europe, of Britain in particular and indeed of Japan, would be threatened. The Americans would be faced with great difficulties as well.
There can be no doubt in anyone's mind that the takeover of those sources of raw materials is one of the options considered in Moscow as an aim of Soviet strategy. There has been plenty of evidence of that, and there has been recent testimony from the Head of State of a country which until November was a close ally of the Soviet Union with whom, along with my hon. Friend the Member for Stretford (Mr. Churchill), I had the opportunity to talk the other day. I refer to the President of Somalia, who told us—I have no reason to doubt the genuineness of what he said, and others better qualified than I who have also talked to him confirm this view—the plan which the Soviets put to him and in which they assigned to his country a particular role.
The plan was this. In return for giving naval facilities to the Soviet Union, Somalia was to be active in destablishing and taking over Djibouti, Kenya and Ethiopia—that was before the Ethiopian revolution—and in helping to bring about what was called "Socialist" hegemony of the Horn of Africa. Following this, the Sudan and the two sources of the Nile would then be under Soviet control. The two sources would be brought together and Egypt would be destablished. Meanwhile, across the Red Sea, with the co-operation of Aden, a threat would be posed through Oman to the Gulf area and through North Yemen to Saudi Arabia.
That was as much of the plan as the President was brought into formally. But he was also given to understand that the longer-range goal was the takeover by Soviet influence of Iran in the north and the South African minerals in the south.
Let us face it. The process is already far advanced. The Soviets are firmly established in Angola, with their Cuban

satellites, and are building facilities in Mozambique. From these they are fomenting and guiding the guerrilla war against South-West Africa, Namibia, and against Rhodesia. There is no secret that at the end of the day they would like to put their hands on the raw materials of South Africa and the southern approaches to the Indian Ocean.
All that is still in the realm of guerrilla war, but in the Horn of Africa we have been witnessing large scale military operations. It is pretty certain that unless drastic steps are taken in the next few weeks the Soviets will gain control of the northern approaches to the Indian Ocean and the Gulf, and in addition, through Ethiopia, the two sources of the Nile through the Sudan and Egypt.
The White Paper has almost nothing to say on this subject. The Secretary of State mentioned it in passing, and paragraph 121 of the White Paper contains the following statement:
Beyond Europe recent developments in Africa, for example, have shown that the Soviet Union is ready and able to deploy military resources rapidly in support of its political interests in the Third World".
It is right to pay tribute to the capability of the Soviet Union. Certainly, I do. The operations into Angola and into Ethiopia have been remarkably well conducted and very daring. The tribute is deserved, but there is no attempt in the White Paper, and there was no attempt in the Secretary of State's speech, to assess the strategic importance and the defence implications of what has happened in those two African countries.
What is done by the Soviet Union is not done simply in pursuit of Soviet
political interests in the Third World".
It is vital to the Western interests involved. The indication of Soviet capability is interesting enough, but what is happening represents a major shift in the world's strategic defence balance of power. I should not be surprised if a future Creasey were to suggest that Angola and the Ogaden were among the decisive battles of the world.
I wish to say a word about the Horn of Africa. The fact that I spent four days there does not make me an expert on the subject, but it has concentrated my mind upon it. I should like to state briefly the conclusions that I reached.
At the beginning of last year the Soviet Union was virtually in control of—it was certainly a dominant influence over—the whole of the Horn. It was well in with the Somalis and with the new Mengistu regime in Ethiopia. It was also in good contact with the Eritrean liberation movement. Then its clients fell out and the Mengistu regime was threatened with collapse under pressures from the Somalis, the Eritreans and the anti-Soviet Ethiopian Democratic Union.
The Soviets had to undertake an agonising reappraisal. They plumped for the Mengistu regime, and they plumped in a big way. Let us not underrate the scale of the intervention. They have pumped in 400 modern tanks. According to the White Paper we have only just under 600 in the whole of BAOR.
The Soviets pumped in 50 or 60 MIG 21 and 23s; we are not sure of the number. They pumped in some of the most up-to-date equipment—helicopters capable of carrying tanks—and there are not many of those, even in the Soviet Union. They did so against Somalia and Eritrea. But it was not just equipment. They put in 15,000 Cuban regular soldiers on top of the 2,000 or 3,000 Soviet officers and technicians. There were also a number of technicians from Bulgaria and Eastern Germany and also South Yemeni units. These were not used against Somalia but against Eritrea. They came from the Aden-South Yemen Soviet territory.
Their decision presented the West with a great opportunity to break the Soviet hold on the Horn of Africa. But what did we do? We repeated in an extraordinary way the pattern of Angola. First, the West blew hot and then it blew cold. Through intermediaries and even through individual Americans—it may have been through the British as well—we encouraged the Somalis to believe that if they ousted their Soviet advisers they could count on Western support. They did, and ordered them out. They went. The Somalis then turned to the West for arms. First, there was a delay. Then there was a refusal. The Somalis were told by the State Department, and by the Western Governments, that they were the aggressors because they had inarched across the Ethiopian border

into the Ogaden. They were then pressed to withdraw. The Russians, Cubans and the others were already pushing them back with their modern equipment. The diplomacy of the West came to the help of the Russians in urging the Somalis to pull out. Under American pressure the Somalis decided to withdraw. Since then they have been told from Washington—I dare say from elsewhere—that they could not expect help unless they gave an assurance to abandon their claim to the Ogaden.
I do not know whether any Somalian Government can do that and survive, particularly a defeated one. I do not know whether we have thought of the humanitarian consequences of our policies, but it is right to bring this up even in a defence debate. Not far off 1 million Somalis live in the Ogaden. In insisting that the Somalis withdraw their regular forces from the Ogaden, and in saying—as the United States has said—that it is "dangerous" to continue the guerrilla war in the Ogaden, we are handing over the Somali population to the tender mercies of the Mengistu regime. I do not think I am exaggerating when I say that President Idi Amin is a liberal compared with Mengistu.
But in seeking to force a withdrawal without some United Nations or other force going in to safeguard the area, in forcing the Somalis out and in demanding that the guerrillas stop fighting, we are now condemning the Somalis to a fate not so different from the fate we had in store for the victims of Yalta when we ourselves insisted on their repatriation after the war.
I return to the defence aspect. Will the Soviets halt at the border? I do not know. There is an irony in the fact that it was Moscow which first gave the assurance that the Ethiopian war would stop at the border. What better confirmation that Ethiopia today has Soviet colonial status? Moscow gave the assurance first and Havana gave it second. It was only after they had both given such an assurance that the Quisling Government in Addis Ababa gave the assurance, too.
I do not know whether they will stop at the border. The Somalis do not believe it They believe that the old imperial Ethiopian general staff plan to push through to Hargeisa and Berbera still


holds good. Certainly the Soviets want to have control of the sea board. They are more interested in the sea than in the mountains.
But, equally, it is perfectly possible that they will stop at the border and seek to exploit the disillusion of the Somalis with the West and the hostages whom they have in their hands. Through their control of the Somali population in the Ogaden, they might bring about a change of Government and a return of Soviet influence to the whole of Somalia.
Meanwhile, the railway line to Djibouti is about to be reopened. Hitherto, Djibouti has been living on French and Arab subsidies. But once the traffic starts, Djibouti will be a ripe fruit for Ethiopia. Then the combined Soviet and Cuban forces could deal with Eritrea, whether by negotiation or by force. Eritrea, with its ports—Assab and Massawa is, if anything, strategically more important that Berbera in the Horn itself.
I was able to see all this the other day when my hon. Friend the Member for Stretford and I flew from Djibouti through the Bab el Mandeb straits—the narrows between Aden and the Horn. As we flew out from Djibouti we were told by Aden on the one side "Do not come an inch closer" and Ethiopia was also saying the same thing. We realised how complete the Soviet control was.
Only drastic steps now can prevent Soviet hegemony over the whole of the Horn; but I see no signs of these steps being taken.
Why is it that the United States and the West have missed this opportunity to regain control of a vital strategic area? The argument has been put forward about the OAU attachment to the sanctity of frontiers. I understand that great importance should be attached frontiers between independent African countries. But we are not talking about independent countries. Ethiopia is no longer an independent African country. It is a Soviet colony.
We have heard about this being a matter for the OAU and the Africans to settle. What is the use in saying that when there are thousands of Soviets and Cubans in the country? I would have thought a sensible policy would have been to help the Somalis check the Soviet-Cuban onslaught, to ask for the with-

drawal of Soviets and Cubans from Ethiopia, then the withdrawal of the Somalis from the Ogaden, and to introduce a United Nations force to help the area while negotiations took place through the OAU. Instead of that, Western diplomacy has helped the Soviet-Cuban onslaught by procuring the withdrawal of the Somalis.
Another argument concerns Kenya. The Kenyans have a natural reason for fearing the strengthening of Somalia but Soviet preponderance in Ethiopia is a far greater threat to Kenya than anything the Somalis could ever do, particularly a Somalia detached from the Soviets.
What the Kenyans really wanted was a Western guarantee of their northern frontier. I do not see why we should not have given such a guarantee in return for any support that we gave to Somalia.
All these were excuses and pretexts. The reason we did nothing is the following, and I raise it in defence debate because it is a defence issue. I believe that the United States and the Western Governments are determined to avoid any confrontation with the Soviet Union in the Horn of Africa, and in other areas, whatever the consequences. That is the real reason. They are not prepared to confront the Soviet Union, however aggresive their intentions, and whatever the danger to our own vital interests.
Why are they so timid? I do not think that the Soviets have any overwhelming strength world-wide. They are very strong in the NATO theatre but, taking account of their overall strength, the Western Powers, their allies and friends could easily match any intervention which the Soviets and the Cubans could make in Ethiopia. Besides, we have other reserves—the ability to cut off food supplies, loans and technology.
It is not fear of the Soviet Union that motivates us; it is fear of the electoral consequences for the governing parties in the United States, here, and to a certain extent on the Continent of Europe. The Prime Minister recently has been likened to Mr. Baldwin. In one respect it is an apt comparison. Students in history of that period will know that Mr. Baldwin said—and it has since been held against him—that he would have advocated rearmament earlier had he not been afraid


that it would have cost him the Fulham by-election.
We have suffered a major defeat for the West in Somalia and the consequences will be felt by our friends in the Sudan and maybe Egypt, as in Oman, North Yemen and up the Gulf. It is idle to comfort ourselves with the argument that the Africans will get fed up with the Soviets and push them out. The tide may well go down but before it does it may have engulfed us first. It may be like the case of the Turks at Vienna. Someone might have said that there was no need to worry because they would go away in the end. They did eventually leave the Balkans—500 years later.
We are pursuing a policy of calculated cowardice for the sake of personal and party advantage. It reveals a terrible lack of faith in our democratic system and values. The same thing is going on in Central and Southern Africa. In Angola we have allowed the Soviets and the Cubans to consolidate their position. Not a word has been said from the Government Front Bench or from Washington in support of the guerrillas of the FNLA and UNITA who are fighting against the new Soviet imperialism.
The Foreign Secretary has expressed sympathy with SWAPO and the Patriotic Front and he has told us that although he has not given them arms, he has sent them non-lethal weapons. The motives for the Foreign Secretary's crush on Mr. Nkomo are the same as his motives in relation to the Horn of Africa. Curiously, these are revealed in the minutes of his conversation with Mr. Sithole which have just been published. Here may I say a word in parenthesis? It was a supreme arrogance of the Foreign Secretary to presume to warn Mr. Sithole against the slip-periness and deviousness of Mr. Smith. Mr. Sithole was in prison for years under Mr. Smith. He was convicted of trying to murder him and he was active in nationalist movements long before the Foreign Secretary was doing up his fly buttons. He knows more about Mr. Smith than the Foreign Secretary can ever hope to.

Mr. Cronin: The right hon. Member for Brighton, Pavilion (Mr. Amery) is making an interesting speech but what in heaven's name has what the Foreign Sec-

tary said to Mr. Sithole got to do with the Defence White Paper?

Mr. Deputy Speaker: I must allow the right hon. Member to develop his own argument.

Mr. Amery: The hon. Member for Loughborough has been carried away—I am told—by a horse the other day in London. He must learn to hold the bit.
The point that relates to the Defence White Paper is that the minutes said that the Foreign Secretary had
warned against confrontation with Mr. Nkomo because it might cause immense problems as Mr. Kuanda was under pressure to involve the Cubans.
That is the defence side of the story.
There is a nightmare and a spectre which haunts both Whitehall and Washington. It is that the interim Government in Rhodesia will succeed in commanding support among the mass of the Rhodesian people, but that the Soviets will intensify the guerrilla war and bring in Cuban guerrillas or others to help Mr. Nkomo and Mr. Mugabe. There will then be pressure on the American and British Governments to help what will be a Government in good standing in Salisbury. We shall then find ourselves drawn into the conflict on the side of the Smith-Sithole-Muzorewa-Chirau combination, perhaps in an alliance with South Africa. Then what would happen to the black vote in the United States' elections, or to the coveted seat on the National Executive Committee? Or to another constituency if anything went wrong in Devon-port.
One can always escape by retreating. Maybe the Gadarene swine thought that they were escaping the butcher when they started on their run. One can trade space for time and it may be wise if one is weak. This was done by Stalin and Chiang Kai-Chek. But this cannot be done in our case.
We at the height are ready to decline. The enemy advances every day".
We could run for a time, but the time will come when we must either stand or surrender.
I foresee that in a year or two we shall have to make a stand, and then we shall be outclassed in weapons and abandoned by our allies. We shall have lost our credibility. Those who study the events


that took place before the Second World War will realise that once we had given way on Austria, Sudetenland, Czechoslovakia and Albania, Hitler could not believe that we would stand on Danzig. He thought that we were on the run. If we give way too often, Moscow may think that we are on the run as well. And when we stand the Russians will play their trump card, wave their superiority at us in nuclear and conventional weapons in the NATO area and threaten the war in Europe which we cannot hope to win without nuclear weapons.
It is later than we think. In all this Britain cannot play the hand alone. We must operate with our allies. But we have a duty to speak out. We have influence—in the EEC and in the United States. What is the use of having a son-in-law—I belong to the same trade union—as Ambassador in Washington if he does not speak out on the views of the British Prime Minister? We also have some influence in the Commonwealth.
We must build up our nuclear and conventional strength. We need to rearm. If hon. Gentlemen below the Gangway could swallow their principles for a while they would realise that rearming would bring in jobs, which would be a help.
We must give help to those who are standing up to Soviet imperialism. Some of those countries will be Marxist, like Somalia. Some will be dominated by Marxist movements, like the Eritreans. Some will be like the Rhodesians—unquantifiable, as the interim Government will be. And some will be like the South Africans—hard-line reactionaries. But all will be fighting against the same Soviet imperialism that is threatening to engulf the African Continent.
We are still stronger on the material side but we are very weak in will. Napolean was right when he said that in a war morale counted two-thirds and materials one-third. I cannot help thinking that the weakness of the West is personified by our somnolent Secretary of State for Defence. As Burke said:
He trespasses as much upon his duty who sleeps upon the watch as he who goes over to the enemy.
I do not complain about his post-prandial somnolence, but I do complain bitterly about a White Paper that ignores the main strategic interests of this country, of Europe and of the whole Western world.

7.50 p.m.

Mr. John Cronin: The right hon. Member for Brighton, Pavilion (Mr. Amery) made quite an interesting speech in some ways. It would have been quite a good speech if this had been a foreign affairs debate. The only relevant matter in respect of the White Paper is the emphasis that he placed on the real threat from the Soviet Union. That is a point one must accept. It arises from the right hon. Gentleman's recent experience of which we read in the Press, namely, the fact that the Soviet Union has far from pacific intentions. I do not know what he meant by referring to some form of intervention at this stage. Is he referring to military intervention by the West in Somalia?

Mr. Amery: The hon. Gentleman is justified in asking that question. What I meant was the supply of equipment, unilaterally if necessary, from this country and urging our allies in the United States and Europe to send supplies as well. Cubans have arrived in Ethiopia in large numbers. There are those in the Middle East, including Egyptians and Iranians, who have already volunteered to do the same on behalf of the Somalis. We shall not take that action, but it could be done. We would win if we did.

Mr. Cronin: I believe that it is too late to take that action.
I must refer to the speech of the right hon. Member for Chesham and Amersham (Sir I. Gilmour). One normally regards the right hon. Gentleman as frank, but on this occasion he borrowed some of the disingenuousness of his right hon. Friend the Leader of the Opposition in the way in which he dealt with some important points.
The right hon. Gentleman said that he would increase defence expenditure by more than 4 per cent. He added that he did not know what the base line would be. That was the most vague and incomprehensible statement ever perpetrated in this House.

Sir Ian Gilmour: It was meant to be vague. I was pointing out these facts because the Secretary of State for Defence asked me to deal with the 4 per cent. because it had been mentioned by somebody. That figure would not otherwise have appeared in my speech at all. I made it clear from the word "go" that


we could not be tied in advance to an exact measurement of what we would spend.

Mr. Cronin: The right hon. Gentleman has become frank again. He has admitted that he did not know what he was talking about. He was saying that he could not say what increase in defence expenditure a potential Conservative Government would indulge in later without his having an opportunity to examine the books. If he cannot conduct that exercise without examining the books, how does he know that the present rate of defence expenditure is wrong? It is the most extraordinary logic I have come across.
The right hon. Gentleman objected to the relative defence cuts which have taken place since 1974, but he forgot that he was a member of a Government who went in for very substantial defence cuts. That was at a time when the full disastrous effect of the Barber Budgets had not been felt and when the Government were in a relatively sound economic state. Surely he is not seriously suggesting, at a time of hyper-inflation, when we are going through the most acute economic difficulties, that he would not have made the same cuts. Our NATO allies were the first to accept our cuts as being necessary in that economic situation.
The right hon. Gentleman attacked the Labour Government, but why did he not also attack our NATO allies in this context? In expenditure terms, taking gross domestic product, we have the best record in the whole of NATO, except the United States. When we take per capita expenditure corrected for currency differences, we find that there is nothing much between us and France and Germany in defence expenditure. We are very much better in this respect than all the other NATO allies. Therefore, I was astonished at the amount of play the right hon. Gentleman made with the somewhat poor material.
I turn to the amendment in the name of the hon. Member for Salford, East (Mr. Allaun) and others. I appreciate the sincerity of their views. The tradition in the Labour Party of abhorrence of war and a desire to cut defence expenditure is honourable and proper, subject to certain limitations.
I should be happy to sign the amendment on one condition—that what is proposed in it should be carried out by the Soviet Government also. Never in history has unilateral disarmament brought any concession from the opposing country. It is an elementary matter of negotiation that one does not give concessions to one's opponent or opposite number unless one achieves similar concessions from the other side; otherwise the whole purpose of negotiation is lost. If that happens, one is no longer negotiating but simply surrendering.
I suggest that the proper course in defence is that which is indicated in the defence White Paper. I believe that that document is exactly correct in the present circumstances. I consider that the decision to increase expenditure by 3 per cent. in conformity with all the other NATO countries is wholly in conformity with the NATO Alliance and our obligations to it. I regard it as just right.
The most important part of the White Paper is the early part referring to mutual and balanced force reduction negotiations. They have been going on since October 1973 and no progress has been made. Progress in those negotiations has been absolutely nil. The reason is simply the obduracy of the Soviet Union.
One would have thought that the Soviet Union, with the Republic of China so close behind it, would have been happy to reach some accommodation with the West. However, it insists on maintaining superiority in men and equipment in Europe. This makes it clear that it regards itself as a potential aggressor at some time in the future. If this were not the case, it would be very much in its interest to come to some arrangement with NATO and to concentrate on its own back door, because it is seriously threatened by the People's Republic of China.
There is no escaping the fact that the Soviet Union has an overwhelming advantage in equipment in Central Europe. The advantage in manpower is relatively small, but it has two and a half times more battle tanks than NATO possesses, roughly two and a half times more artillery and two and a half times more fixed-wing aircraft for ground attack. Why do the Soviets insist on this overwhelming preponderance? Why do


they insist on having the capability with their large tank armies to force their way straight to the Rhine when they have no wish to do so? It can only be with the idea that at some time in the future they will be able to launch themselves on a military adventure which will be very much to the disadvantage of the Western allies.
One aspect of the White Paper that troubles me is the reinforcement of our forces in central Germany. Our whole deployment there is based on the assumption that reinforcements can deploy fairly quickly. But we no longer have this option. The Warsaw Pact forces now have the ability to launch what is known in military language as "an attack by forces in place without prior reinforcements"—in other words, a completely surprise attack.
So far, NATO defence plans have been based on obtaining a relatively long period of warning in the shape of hostile troop movements, logistic activity and political indicators such as tension in foreign affairs. But there is little prospect of such warning now, because the Warsaw Pact Powers can advance and attack with no warning. Those hon. Members who have been to headquarters in Müchen Gladbach and questioned staff officers there have been told frankly that they would have no more than 48 hours' warning of an attack. That is uncomfortable news for NATO's present strategy, which has not been changed, of reinforcements coming over one month after being attacked. The Soviet Union now has a massive nuclear submarine fleet. It could certainly put a stop to United States reinforcements coming by sea across the Atlantic; this would be their principal route.
Some of my hon. Friends may say that there is no real evidence that the Soviet Union has anything but pacific intentions, but if one ignores the last 40 years, if one ignores the fact that Estonia, Lithuania, Latvia, Poland, Bulgaria, Rumania, Hungary and Czechoslovakia, which were all free, have all been overrun by the Soviet Union, then the presence today of Soviet generals, military equipment and troops in the Horn of Africa is another indication that we are dealing with potential aggressors all the time. There must be no question of our letting

down our guard and the Government must continue to give full support to NATO.
I might take the Secretary of State to task on one point. I am a little surprised that NATO does not consider any possibility of military discussions with the Chinese People's Republic. I put that to my right hon. Friend in a debate some months ago, when he said that it was worth considering, but we have not heard whether any further consideration is taking place. When one knows of a potential aggressor, it may be worth while to have a few words with the nation sitting in the aggressor's back garden who can hit him as well. In 1939 and earlier, the then Government refused to have any meaningful military talks with the Soviet Union when it was obvious that Germany was a potential aggressor. There is a strong case for military talks with the Chinese.
The right hon. Member for Pavilion, reminded us that Napoleon said that morale was two-thirds of winning a battle and material only one-third. Much has to be done for our Armed Forces' morale. With other hon. Members, I went to Gemany in September. It was clear to all of us that the morale there, particularly among technically qualified NCOs and the older well-trained, useful soldiers, was gravely impaired by their pay situation.
The pay of the Armed Forces has dropped back compared with that of the average industrial worker to an extent which is deplorable. The average pay of a manual worker is probably nearly £80 a week. The average Service man gets £23 less. There can be no justification for that. A lieutenant commanding a troop of tanks in Germany gets about £80 a week—less than most long-distance lorry drivers. An RAF pilot, piloting a£3 million Phantom, gets less than a bus driver. That cannot be right.
I know that the Secretary of State is sympathetic and that he meant it when he said today that he would do his damnedest to get the best deal he could for the Armed Forces, but I am worried whether he can achieve all he should in dealing with his Cabinet colleagues.
My right hon. Friend also said that he would do this when pay policy allowed. It looks as though the Government's pay policy will continue after this August and


that there will be further restraints on wage increases. Does that mean that justice for the Armed Forces over pay will be deferred to the year after next? I am sure that the morale of the Forces would not be able to stand up to that.
I hope that the Secretary of State will insist on a fair deal for the Forces. I am sure that, even within the present pay code, the Forces could get more than 10 per cent. There is no reason why they should get an Irishman's rise which is immediately swallowed up by increased deductions for lodgings and food. There is a grave danger of a catastrophic decline in morale. All defence expenditure is wasted if people are not prepared to use the military equipment put into their hands or if they do so in conditions of great psychological inferiority.
The Government should, above all, be a good employer, and they are not being a good employer to the Armed Forces. Depending as they do on trade union support, they cannot justify imposing on the Armed Forces terms of employment which no trade union would tolerate for its members.
A Socialist Government must look after the low-paid. Privates, for example, in Northern Ireland deserve much more consideration. At the moment, they are earning about 33p an hour on some occasions. I know that it can be said that the Army is recruited on the basis that long hours will be worked in unusual situations, but the cleaners in the Ministry of Defence who make the Secretary of State's office spick and span get more than three times that amount—and if they did not, there would be terrible trouble from the unions. A Socialist Government must look after the low-paid—and that includes people in the Army who are at present living in poverty and suffering because they are too loyal and dedicated to make the most of their case themselves.

8.9 p.m.

Mr. R. Bonner Pink: The hon. Member for Loughborough (Mr. Cronin) complained that my right hon. Friend the Member for Chesham and Amersham (Sir I. Gilmour) would not be specific in his proposals for increased expenditure without seeing the books. My right hon. Friend has every right to be cautious. Every time there is a Labour Government, there

is a financial crisis. Every time we return to power, we find that the cupboard is bare. I see no reason to suppose that there will be any difference next time.
I am glad that the hon. Member is joining us in not being complacent about the White Paper. Certainly my right hon. Friend the Member for Chesham and Amersham and others have pointed out that there is an air of completely unwarranted complacency throughout the White Paper.
The Warsaw Pact countries are getting relatively stronger every year. We want to reverse that trend. The Minister asked what social services we would cut. He must realise that, unless we have the will and the ability to defend ourselves, all our social benefits and way of life are at risk. Yet he does little about it.
The White Paper describes recruiting and re-engagement as satisfactory. How much is due to the deplorable level of unemployment and the difficulties of finding jobs, especially for the older men? When things improve, will recruiting and re-engagement suffer?
The Minister must know, having heard this point made in almost every speech so far, that morale in the Services is dropping because of poor pay. I welcome his statement that the Forces will get a rise on 1st April. But the Minister is still hedging. He said that differentials would be restored, but he would not say when. It is just sometime.
Service pay continues to drop back compared with industry. Yet Service men are called upon not only to face danger in Ulster and elsewhere but to do all kinds of jobs which are not properly theirs.
There are many other small niggling factors which cause morale in the Services to fall. One small matter, which I have raised on a number of occasions, is the pre-1950 Service widows' pension. There are not many of these widows, they are elderly, but they feel very strongly about this matter. They compare their state with inflation-proofed Service pensions of later entrants and Civil Service pensions. They are making much anti-Service propaganda about this small matter. It would cost very little to put it right. I hope that the Minister will again consider it and this time agree to do something about it.
Another small matter which is causing a lot of ill-feeling in the neighbouring


constituency of Gosport is the issue of Service voters. This applies especially to the wives of Service men. I hope that the reasons for the new system will be explained and made clear to them yet again and that Service men's wives will have the choice of being either Service or ordinary voters.
I turn now to ballistic missile submarines. We still have only four. According to the White Paper, one is being refitted, so we have only three in service. It is clear from that number that often we have only one on patrol. If we had only one more, making five, we could on many occasions have three instead of two on patrol. At least, we could have two on patrol all the time. I know that it would be expensive and that the Polaris missile is outdated, but there are replacements for that. I again stress the need to increase the fleet by one.
I am worried about convoy protection. This country lives by its imports by sea. In 1939 the Germans had about 50 effective submarines. Today the Russians have 195, of which 104 are nuclear. We have 54 frigates. How does the Minister propose to safeguard our convoys?
Another worry is the vulnerability of our offshore oil and gas installations. How are they to be defended effectively not only from enemy attack but from sabotage? We have five Island class vessels in service and two more are on order. They are small 19-knot ships—glorified trawlers. By extending our fishing zone to 200 miles, our patrol area has been enormously extended. Would it not be better to have the same number for preference, or even fewer but larger and faster ships capable of carrying helicopters? The range of such ships would be enormously extended. If the ships were large enough—I have in mind something similar to a modern version of a wartime hunt destroyer—they could carry a small contingent of Royal Marines which could be used for anti-sabotage duties on the oil rigs and as support troops in emergency.
We have heard a number of references to the cost of services not strictly for defence. The White Paper details the services for which the Services pay—education, medical services, inshore fisheries protection and so on. Such services are not properly defence commitments. Why do the Defence Estimates have to carry

those items? Why cannot they be transferred to the appropriate Departments?
I am pleased that, from a constituency viewpoint, Portsmouth Dockyard has been allocated guided missile destroyers and larger ships for refitting. This matter has pleased people in Portsmouth. They felt that they had been neglected in the past. This decision certainly ensures continuity of employment in the city.
Finally, I must say that I am appalled at the air of complacency which exists in the White Paper, and I condemn the Government for it.

8.17 p.m.

Mr. Terry Walker: I support the motion in the names of the Prime Minister and of my right hon. Friends.
In determining the level of defence expenditure, many factors have to be taken into account. It is a matter of balance. We have to consider not only the extent of our commitments and the capabilities that we and our allies need to possess in the light of the assessment of likely future threats to our national security but the wider economic and social factors. The difficulty about this type of assessment is that very little of it can be based upon hard, indisputable facts.
The Government's objective to negotiate a multilateral treaty banning nuclear explosions is one which all of us share, for we must encourage advances in arms control and eventually agree on strategic arms limitation.
The Government have rightly continued their policy of detente rather than confrontation. Some hon. Members who have already spoken seem to favour confrontation rather than detente. Many of my hon. Friends and I regard detente as most important. Indeed, it is the only way to proceed to a more peaceful and saner world. We look forward to the United Nations Special. Session on Disarmament to be held later this year at which I hope the Government will make new proposals to improve world prospects for peace, which is most important.
The economic arguments against defence expenditure were set out clearly by my hon. Friend the Member for Salford, East (Mr. Allaun), but they are less clear-cut than some people would


have us believe. Drastic cuts in defence expenditure would be extremely damaging in many areas. No one would argue for defence expenditure solely on the ground of the employment it generates, but defence is a large employer, as are the Armed Forces, which include civilian personnel, and the defence industries. It has not been proved that a substantial diversion of much of these resources would not lead to a decrease in the total national product and, in these days of high unemployment, it could, in the short term, lead to an increase in the number of unemployed.
As well as defence production, we have to consider the sales that we make throughout the world and the benefits in terms of technological spin-offs for a significant proportion of civil industry and the arms trade. Many of us believe that this trade should not be encouraged, but until we can persuade other countries not to buy arms it is ludicrous for us not to produce and supply some of these arms. It has been proved that if we do not provide the arms other countries will step in and pick up the contracts.
Much of the Opposition's case against the Secretary of State is that the Government have neglected the safety of this country, but the White Paper forms a balanced view of what the Government are trying to achieve.
I return to the social aspects of the production of military equipment. Many of my constituents are employed in the aircraft manufacturing industry, which produces about 80 per cent. of its output for military purposes and 20 per cent. for civil aviation. Many of us, especially on this side of the House, want to see different proportions and to see the civil side increased, but many of my constituents are losing their jobs on the civil side of British Aerospace and are being forced to take work on the guided weapons side.
It is a worry for many of my constituents and for the trade unions concerned to see the lack of civil aircraft work on the stocks and to note an increasing amount of work being devoted to military aircraft. Many people say that the British aircraft industry should diversify rather than do so much military work, but men with skills in high tech-

nology cannot be switched overnight to making pots and pans. Many of us are working to make sure that there is a larger civil element in the industry's work, but, in the meantime, it would be detrimental to many of my constituents for the jobs to be cut down straight away. The workers in the industry are highly skilled and we need to use their skills.
There are spin-off effects from aircraft development. Many people in Bristol remember the TSR2 being axed in 1964. Many voices were raised against that decision, but the experience and technology developed on that project was not wasted. It was invaluable in the development of Concorde.
One welcome decision during the year was the continuing development of the MRCA Tornado with European cooperation and the continuation of the RB199 engine which is largely being built in Bristol. The decisions on the Tornado have meant continuing employment for many of my constituents at Rolls-Royce. The aircraft will be one of NATO's main strike planes in the next decade, and I greatly welcome the decision.
The White Paper refers to the conversion of the Nimrod aircraft to an early warning role starting in the 1980s. That was another welcome decision and was more sensible than going to Boeing for the AWACS.
Mention has been made of the pay of our Armed Forces. Having been to Northern Ireland and seen the problems that our young troops are facing there, I must say that if there ever is a special case—and we have spent many years arguing whether there should be special cases—these young men should be borne in mind. I pay tribute to the gallantry of the British Service men whose job has been to maintain law and order in that most unfortunate part of the United Kingdom where, for nine long years, we have been virtually at war.
It has been a costly business, not only in terms of finance and men and equipment, but in terms of the good will of the troops.

Mr. Hoyle: I am pleased that my hon. Friend has pointed out that sympathy for the troops' cause is not confined to one side of the House, but does he agree that if we are to improve the pay of our


troops the archaic system of pay review with no one representing the Forces on the Pay Review Body is not the way to do Pay Review Body is not the way to do it? Does he agree that we should follow the lead of our NATO allies and give the troops trades unions and proper collective bargaining? Does he agree that the pay and conditions of our troops are ludicrous compared with those of our allies?

Mr. Walker: I agree with much of what my hon. Friend says. I do not know whether he thinks that his union or mine would benefit from such action. My main concern is that we should be able to pay proper remuneration to Service men. We want to get away from the present archaic review, but at present the recommendations of the review must be acted upon.
The behaviour of British Service men in Northern Ireland has maintained the tradition of courage and gallantry of British Forces in exercising their duties. I consider it a privilege to have been there and seen how they have operated. The Government's policy in continuing to operate security in Northern Ireland based on the role of the Royal Ulster Constabulary as an instrument for the maintenance of law and order must at some time convince the House that special payments should he made to members of the Forces serving there.
I, like my hon. Friend the Member for Loughborough (Mr. Cronin), have been to Germany and seen the troops there. When I was there in 1975 there was a good deal of unrest because of the plunging pound. We hear much now on the BBC about the plight of American service men because of the plunging dollar. It is important that the House be aware of the problems facing our troops serving abroad, in Germany in particular.
We must acquaint ourselves with the very ticklish problems that arise in Germany. We should be giving more attention than we seemed to be two years ago to the problems not only of pay and remuneration but of family welfare. I hope that we are doing much more in this regard now than we were then.
I believe that the motion should be supported because the Government are right in the balance they have taken.

8.32 p.m.

Mr. Michael Hamilton: I pay a very warm tribute to the Secretary of State for the pages in the White Paper describing the increasing threat from the Soviet Union and from the Warsaw Pact countries. But we are not successful in our search through the pages for a counter to that threat. The right hon. Gentleman will know that I am privileged to have in my constituency the headquarters of United Kingdom Land Forces. I am also very conscious that within the United Kingdom today there are fewer units than at any other time this century.
Increasingly I am coming to the view that if we want to learn anything about what is going on in defence we should not look at White Papers for it. I learnt that quite early on. I fought my initial by-election at Salisbury soon after the Labour victory in 1964 and at that time the TSR2 prototype was having its tests at Boscombe Down. We saw it flying overhead every day. It flew out to the Isles of Scilly and up to the Pennines. It was a world beater. It far exceeded the hopes of its designers. In April 1965 Mr. Roy Jenkins, in his Budget speech, condemned it to death. He snuffed it out and the order went out to destroy the jigs so that the project could never be resurrected. From that moment on, I have learnt what degree of priority is accorded to defence by Labour Governments.
A fresh blow has fallen, and I want to say a few brief words about the Microbiological Research Establishment. This is to be closed. It was set up with courage and foresight by the Attlee Government. In 1945 it was a dangerous world. Not only did the Attlee Government develop the nuclear bomb but they set up this establishment. It is purpose built. It is one of the largest brick buildings in Europe. I have seen a good deal of the laboratories. I reckon to know what these small teams of scientists have been doing. I would even be immodest enough to claim to know as much as the Secretary of State about what goes on at the Microbioligical Research Establishment.
Soviet aircraft enter our skies daily. It must be remembered that a single aircraft, making use of prevailing winds and carrying a tank full of some microbiological agent, could do indescribable


damage to our civilian population. Yet this establishment is to be closed. It is right that the House should appreciate that if the Attlee Government were right to set it up it follows that the Callaghan Government must be wrong.
Within the last fortnight yet a further blow has fallen. Another establishment is to be closed, namely, the Joint Warfare Establishment, which is unique in NATO. It is a centre where senior officers from the United States, Germany and the other NATO countries gather for studies and conference work. It is the "think tank" of NATO. It is sited ideally close to many military centres such as the headquarters of the United Kingdom Land Forces and the ranges at Larkhill. Now it is to be closed. A remnant is to be moved and merged with another organisation.

Mr. Mulley: The hon. Member should not mislead the House. The establishment will be removed to Latimer where it will join the Defence College. The Joint Warfare Establishment, which I agree is valuable, will be continued in another and probably better venue.

Mr. Hamilton: I explained that a remnant was to continue but it will be far removed from the convenience and proximity of other military installations.
I am astonished by the phlegmatic conduct of the Chiefs of Staff in the defence argument. We all remember when, just before Christmas 1976, they exercised the right of calling on the Prime Minister at No. 10 Downing Street. But that stage was reached only after five successive cuts in our defence expenditure. In any case, that little ritual visit made not the slightest difference. The Chief of the Defence Staff, as all hon. Members will remember, told the public on television in the summer of 1975 that our defences were down "to absolute bedrock". After that came three further series of cuts. The Secretary of State will admit that. I am astonished that such a situation could arise. That particular Chief of Staff continues to serve the Government. He is waiting today, ready with his suitcases packed, to implement the Owen initiative in Africa. That is yet another project which has reached absolute bedrock.
The day is only a few months away when we shall turn the corner and when once again defence will have its rightful priority in the Government's schedule.

8.41 p.m.

Mr. Doug Hoyle: I wish to concentrate on one aspect of defence—the need to bring democracy to the Armed Services. I feel that there is a vacuum in our democratic life when 350,000 people are denied a basic right. I do not think that sentiment conflicts with the amendment that carries the names of my hon. Friends and myself, which says that defence spending is too high. For us to say that it is too high does not mean that we should treat the people who serve in the Armed Forces as they are treated today—as poor relations.
We note that the Secretary of State has no objection to people in the Armed Services belonging to a trade union as long as that does not conflict in any way with military discipline. That is not quite the objective we have in mind. We are partly following the precedent set by others of our NATO allies whose Armed Forces have trade unions. I should like to refer to the Assembly of the Western European Union in 1974 when comment was made on the conditions of service in the various European armed forces. The discussion was based on Article 4 of the Brussels Treaty. Contributions at the Assembly called attention to the considerable differences in the pay and conditions of the armed forces of the various allied countries, and to the desirability, as far as possible, of having a standard rate for personnel in the different forces of the same country.
The Assembly then went on to recommend that consideration should be given to the
experience of those countries that permit elected representatives of the armed forces to participate in negotiations on conditions of service and rates of pay".
That in itself was a considerable step forward.
There is little point in saying that there is no objection to anyone joining a trade union if that is not the be all and end all of the matter. A person joins a trade union only to secure better pay and conditions. This attempt to organise an effective trade union in the Armed Forces


is still frowned upon by the powers that be. I do not for one moment include my right hon. Friend the Secretary of State in that. I suspect that those powers include the Chief of Staff and all the brass hats who sit in their offices refusing to come into the twentieth century but remaining in the days of Queen Victoria, still thinking that we have an effective empire. That attitude was reflected in many of the speeches by Conservative Members today. They were not even tinged with reality.
We are frequently confronted with the advertisement that refers to "the professionals" in the Armed Services. We say that in their turn the Armed Services need the professionals—the professionals in the trade unions—if they are ever to get better pay and conditions. In many of the ranks, the duties undertaken are skilled duties, such as those of technicians and nurses. They have an equivalent in civilian life. There is no reason why those concerned should be operating under conditions that are any worse than those in civilian life.
We hear so often that morale is dangerously low. My hon. Friend the Member for Kingswood (Mr. Walker) told us that he had been to Northern Ireland and had seen the very difficult tasks that our troops were facing there, yet morale was very low not because of those tasks but because of the present pay and conditions. That is hardly any wonder when we see the archaic way in which pay and conditions are dealt with by the Armed Forces Pay Review Body. The names of those who form that body show that they are all distinguished people, in their own way, but I suggest that they are very elderly and very out of touch. No trade unionist is serving on that body. Indeed, it is even more remarkable that there is no serving member of the Armed Forces on it. There could not be a better injection into that body than some people from the other ranks of the Armed Services.
However, what does this body do? It determines the pay and conditions of all ranks up to the rank of brigadier. For those above the rank of brigadier, from major-general upwards, it is the Top Salaries Review Body that performs this function. Therefore, all that this body is doing is reacting to pay and salaries that have already been fixed at the top. If one is in the right place in the pecking order,

one might get a little more as it is passed down the line. It is like the handful of corn when one passes it from hand to hand and hopes that the bloke at the end of the line will get some when it comes to him. This is not the way in which we should be dealing with this matter.
This matter must obviously reflect across to a consideration of similar jobs done in civilian life. The pay and conditions of the Armed Forces must be attractive enough to recruit people into them. They must also reflect the special conditions of Service life, such as the fact that a man might be away from home, does not get overtime payments, and very often works under very difficult and arduous conditions.

Mr. Edwin Wainwright: Will my hon. Friend comment on who would be organising the people in the Armed Forces? Would it be outside unions, or would there be one union formed inside the Armed Forces to represent the personnel?

Mr. Hoyle: No, I think that the skills and expertise are in trade unions outside. I would hope that they would be organised by trade unions affiliated to the TUC. I shall not go beyond that, because there are several unions within the TUC, as my hon. Friend knows, that are interested in recruiting men in the Armed Forces. My hon. Friend and I are both interested in the trade union movement, and he well knows that there is an orderly way of doing this, by using the Bridlington agreement and the trades union disputes committee to sort out that kind of problem.
At present, if the Armed Forces are to get adequate pay and conditions, the important thing is that this type of expertise must be applied and we must bring the Armed Forces into line with those of NATO allies who have trade unions to organise them.

Mr. Anthony Nelson: Does the hon. Member accept the point that many of us would wholly condemn such a move not only because of the way in which the professional volunteer status of the Armed Forces of this country is cherished but, more particularly, because of the basic reason—which is not to do with pay comparability—that there could be a situation in which the


Government of the day demanded the complete and undivided loyalty of the Armed Forces and that unionisation could involve a conflict of interest in such a situation? That must be the principal objection to the hon. Gentleman's proposal.

Mr. Hoyle: I well understand that there will be objection by the Conservative Party to people being able to join trade unions. That does not surprise me in the least. The hon. Member was talking about the professional side of the Armed Services. If he compares the pay and conditions of the Armed Forces in this country with those of our NATO allies, in which countries there are trade unions, he is on a very poor wicket. We have fallen far behind. Let us take a person whom the hon. Gentleman would regard as a professional, a lieutenant. In the British Army he receives £77 per week. If he were in Belgium, where there are trade unions, he would receive £120. If he is lucky enough to be in Denmark, he would receive £164. On the other hand, a private receives £52 in this country. In Denmark he would receive £122, or in Norway, £102. In many of those countries he would also be working a 40-hour week and would be paid for overtime.
Those are the kind of professional conditions that we want. On the Conservative Benches there is a lot of laughter. I thought that they were friends of the people in the Forces.

Mr. David Walder: I accept that there may be something in the hon. Member's argument about pay. I was wondering about conditions. I wondered whether we had reached the ultimate situation in which a trade union which was operating in the Royal Navy said that it was thinking of having a strike because the conditions under which its members had to work—that is, the fact that the Polaris missile was outdated—were unsuitable, and they went on strike hoping for a renewal of that missile from the Government. What happens then?

Mr. Hoyle: The hon. Gentleman is being his usual humorous self. He knows as well as I do that those of our NATO allies who have trade unions have not the right to go on strike. As far as I know, the one country, outside Europe, that has

that right is Sweden. A strike occurred on one occasion in Sweden. It has not been repeated. However, Sweden has not amended any laws in relation to it.
I think that I deserve better from the hon. Gentleman than the red herring that he draws across the matter, or a red something else, bearing in mind the speeches of his colleagues in the Conservative Party. What he has said does not apply, and he knows it.
What I am discussing is how we improve those conditions. It might upset the colonels' ladies in Aldershot. It might make retired colonels very red when they are having their drinks in the bars, particularly if they are drinking port. There is a lot of hypocrisy in the Conservative Party when it continues to talk about better pay and conditions. Conservative Members ought to be supporting people such as ourselves who are trying to pave the way, and they ought to say that this is what is needed.
The question of discipline in the Armed Forces if there were trade unions has been mentioned. The conditions of those in the Armed Services have been worsened because of the recent Armed Forces Act. One of the reasons for that is the fewer courts martial. There has been an increase in the summary powers of commanding officers. Everybody might agree that cutting out the expense of courts martial is desirable, but if summary powers are used by a commanding officer, there is not the right of representation of the person who comes before him. That is the wrong way to go about the matter. Every individual ought to have the right to be represented. I say to the Under-Secretary of State for Defence for the Army, who will be replying on that matter, that one of the advantages of having a trade union would be that a trade union would go into the procedures of drawing up its disciplinary and appeals machinery.

Mr. George Rodgers: Would my hon. Friend agree that the arguments put against trade union membership for members of the Armed Forces are similar to those which were put against merchant seamen being members of trade unions? In recent years unions have been established for merchant seamen and shop stewards operate at sea. The system works successfully.

Mr. Hoyle: I am indebted to my hon. Friend for that information. We can take it even further. Trade unions were objected to when they first appeared in industry. It is only a progression. Although some Tory Members may fight against it, it is inevitable that there will be trade unions in the Armed Forces. The trade unions would be involved in drawing up disciplinary procedures. That would be a benefit to all their members.

Mr. Mates: The hon. Gentleman's rubbish is becoming dangerous because it is untrue. Therefore it must not go unchallenged. He says that because there has been an increase in summary powers, there are fewer rights accruing to the soldier, sailor or airman. That is not the truth. In any case when a commanding officer wishes to make use of the increased powers he has to offer the Service man trial by a court martial, when he would have all the rights of representation which his civilian equivalent has. None of those rights is being eroded and, if I may suggest it, none of them would in any way be assisted by membership of a trade union.

Mr. Hoyle: That is an opinion which will go down well on the Tory Benches.

Mr. Mates: It is a fact.

Mr. Hoyle: It is true that on summary conviction there is no right of appeal.

Mr. Mates: It is not true. Ask the Minister. The hon. Member is talking rubbish.

Mr. Hoyle: It is not rubbish. If it stirs up the hon. Member to think about the matter, it is worth while.
Disciplinary procedures could be drawn up for the Armed Forces by the trade unions. Not only would such procedures safeguard the personnel and prevent unfair treatment, they would safeguard the officers carrying out the hearings. The trade unions would be demanding the right to represent their members at every stage. That is the way forward. I would have thought that that would be attractive to those serving in the Armed Forces.
It is always said that discipline would be eroded as a result of the entry of trade unions into the Armed Forces. I draw the attention of Tory Members to a survey carried out by the American Federa-

tion of Government Employees fairly recently. This investigated 60 soldier association in countries where there are trade unions in the Services—Sweden, Norway, Denmark, Belgium, West Germany and Holland. The conclusions of that survey were that unions improved internal commitments and morale, created more democracy and enlightened service and improved the attractiveness of a military career.

The Under-Secretary of State for Defence for the Royal Air Force (Mr. James Wellbeloved): I am sure that my hon. Friend would agree that one of the things which would be most welcomed by members of the Armed Forces is an end to the investment strike on the part of the hon. Member and his hon. Friends which has a tendency to deny serving members of the Armed Forces essential equipment if they are not to be sent on to the battlefield naked. Would he not agree that we not only want decent pay and conditions for members of our Armed Forces but we also want equipment, investment and the means whereby they can do their job so as to ensure the freedom, peace and security of this country?

Mr. Hoyle: I am always impressed by the views of my hon. Friend. He always expresses himself in forthright language. I do wish that he had listened to how I began my speech—

Mr. Mates: Why?

Mr. Hoyle: I said that, whatever money was spent on defence, the members of the Armed Forces ought to have decent pay and conditions. I stand by that. Tory Members cannot object to that, because they talk of the operation of monetary forces. Their leader talks about limitations in all areas of life.
Because my time is running out, I shall conclude what I have to say. After all the sneers from hon. Members on the Opposition Benches, it is interesting to note what was said by the United States Chief of Staff, General David Jones, only last year. He said that the United States armed forces "because of discontent"—I ask the House to note those words—
because of discontent could be unionised within five years.
Surely, we shall not have to wait five years with a Labour Government in office. I hope that the Government will


seize the opportunity because this change must come. As I said at the outset, it is in the interests of democracy that 350,000 people should not have their rights denied to them. I can think of no better advance.
Of course, I can well understand why hon. Members opposite are upset. Either they or those whom they represent are, in the main, retired officers. We realise that as they make their speeches, one after the other. But they do not adequately reflect the new breed of soldier who is coming along, who really is a professional. Our Service men must be paid well and have decent conditions. If they are ever to achieve that, the only way forward is through the trade union movement, and I look forward to welcoming them as brothers.

9.1 p.m.

Mr. John Loveridge: It is difficult to have read the White Paper without having had the feeling that there is one respect in which we are deficient and which calls for strengthening, namely, in our reserves. Plainly, these are inadequate to meet even very limited contingencies either in Europe or across the world.
We have cut the amount we are spending on research. Even last year's White Paper told us in paragraph 328:
… without detriment to military objectives, research and development effort on defence against chemical warfare can be reduced to about two-thirds of its present size.
The White Paper went on to limit to 10 the number of scientists working on microbiological research. That was said to be adequate. Who determined "adequate" in relation to just 10 people to deal with a field of world-wide and almost daily discovery?
The present White Paper finds something worth describing with a strong adjective, that is, the word "important". Paragraph 535 proudly speaks of our ships filling a major role, and it then goes on to tell us what is important, namely, in the
important task of running down the Malta base.
That seems to be the keynote of the present White Paper. It is hard not to feel that it tells us nothing except trivia and contradiction, and this at a time when Russia is spending one-eighth of her total

revenue on military expenditure while we are committing only one-twentieth of ours.
The Russians have built up a most powerful navy and a great merchant marine to support it, subsidising theirs, if they can, to put our merchant fleet out of business. In central Europe we are outnumbered by 2½ to 1 in tanks, aircraft and artillery. A short time ago, Russian arms enabled the North Vietnamese to drive the Americans away from their allies in the South. More recently, the Cuban mercenaries of Russia helped to conquer Angola, and they are now fighting in Ethiopa. They also have headquarters in many other countries of Africa. They have mobility and adaptability and are quick to move.
In almost every other nation there are trained terrorists active in inciting hatred and bloodshed. It is no wonder that China calls upon us to beware. But how? How can we be on our guard more than we are? We have many allies. We have a brave and patient Army fighting terrorism in Northern Ireland, and we have an excellent small Royal Navy and Royal Air Force. What else can we do? First, as we have spare capacity in steel, shipbuilding and engineering we can build a bigger Navy at almost no cost to us in natural resources, and save jobs at the same time.
Paragraph 207 of the White Paper says:
Some 70 per cent. of the Regular and Reserve Army will, in time of war, be deployed to the European mainlaind
Can any of us be confident that those who remain widely spread across this island would be adequate to meet an effective airborne invasion in full force? We should not safely assume that the nuclear deterrent will necessarily rest with us as the response. We cannot know whether any future war, if one came, would be long or short. All that can be certain is that the 116,000 Regular Army reservists and 57,000 in the TAVR are not enough.
If the Government put their full effort behind the Central Office of Information, they could so inspire the people of this land that they could rapidly double the numbers of those reserves at small cost. We should take an example from the Swiss and the Israelis. Defence should not be something apart from the people.
In a free society, in a democracy, the main population of the land has a right to consultation and participation in the work of our survival against threat.
Only by a Government's building on that concept of one nation, one people working together can the defence of our safety be built up to the required strength. Otherwise, the united purpose that we must show will not be present, and we may tempt the hawks of Russia to tempt their more dove-like colleagues to dangerous action which all of us might regret.
I ask the Government to put this matter to the people. I ask them to consult the people throughout the land, to find out what the people want and to set up in every area working committees drawing Service men together with the civilian public to plan how each can help the other and so make our country safer, redeveloping that volunteer spirit on which we must depend. No Government will ever be forgiven if they let our people once again be drawn into great sacrifices unprepared and untrained—above all, untrained.
None can know whether future warfare might be short or long. All that we can know is that certain dangers lie ahead—dangers to our routes round the Cape of South Africa, the routes that bring Europe's very lifeblood to it, routes that might be cut. The Navy should look to a close association with the civilian Merchant Navy; and, as Lord Chalfont quoted in an article a short time ago, the Royal Air Force should consider the extension of the civilian connection, even with the possibility of enabling aircraft to carry cruise missiles.
I should like here to say "Thank you" to the Under-Secretary of State for Defence for the Royal Navy in connection with my Naval Defence (Inquiry) Bill for his courtesy and kindness in enabling me, at my request, to come to talk to him and his officials later this week. I deeply appreciate that.
I believe that people throughout the land share a fear over the expansion of the Russians and their allies, the expansion of terror. These are matters that must be met, and the way to meet them is surely to bring the whole nation together—not to have an Army, Navy and Air Force that are isolated from the rest of the community but to bring the

whole community together with them to build up a, reserve based upon the people of our island.

Several Hon. Members: Several Hon. Members rose—

Mr. Deputy Speaker: I call the hon. Member for Aldershot (Mr. Critchley).

Mr. Mates: On a point of order, Mr. Deputy Speaker. May I ask for your help over the question of Back-Bench Members' contributions to the debate? I am sorry to cut short my hon. Friend the hon. Member for Aldershot (Mr. Critchley), but he will know that I am not referring to him.
By the end of to-day's debate there will have been four contributions from the Front Benches, lasting two and a half hours out of five and three-quarters hours' debate, and only 12 Back Benchers will have taken part. There are hon. Members on both sides of the House who have been here for the entire debate. The position is not helped when senior Members come in, make lengthy contributions and then go away again. May we ask, Mr. Deputy Speaker, that we have more chance to participate in debates in which we take a long interest, and seek your help in so doing?

Mr. Deputy Speaker: I appealed for brevity at 7.19 p.m. Unfortunately, my appeal fell on not very receptive ears. All I can say is that the Chair has taken note of those hon. Members who have sat throughout this debate today. I have already made a note of those who have been present which I shall give to Mr. Speaker.

9.10 p.m.

Mr. Julian Critchley: The charge we are making against the Government is a grave one. It is no less than hazarding the security of the realm through neglect and in the process alienating our allies and losing the respect in which the world once held this country.
I must remind the House of the number of defence cuts, and their extent, in recent years. In 1976 the Government slashed defence by nearly £600 million. In 1977 the figure was £953 million. In 1978 it will be £1,200 million. The planned reduction, projected to 1983, is £9,918 million. That very clearly goes far beyond the concept of good housekeeping.
From the moment of their election in February 1974 the Government, while multiplying State spending on everything else, began the process of slashing spending on defence. The Government excused themselves for their policy apparently on four counts. First, they say that the threat has been overstated; secondly, that defence spending is adequate to the task in hand; thirdly, that their effort compares favourably with that of our allies; fourthly, when forced to retreat from one prepared position to another, that we are doing all we can possibly afford.
We Conservatives find these excuses lame and unconvincing, as does the country. I shall try to show why. Has the Soviet threat really been overstated? Clearly not in the series of Government White Papers. But the portion of the threat was written by civil servants and fits uncomfortably with the announcement of reductions, and their justification, which inevitably make up the second half of these documents.
The growth of Soviet power is obvious to us all. It is a fact. Each year the Soviet Union increases its defence expenditure by about 5 per cent. It spends between 11 per cent, and 13 per cent, of its GNP on defence, nearly three times the NATO average. In real terms, it spends 30 per cent. more than the United States. We in Britain spend about 5 per cent, of our GNP on defence.
In recent years, the Soviets have achieved strategic nuclear equality with the United States—there are those who would assert strategic nuclear superiority over the United States. In recent years, the Soviets have achieved superiority in nuclear weapons deployed in Europe where they are equipped with tactical nuclear weapons which combine range, mobility and yield to a degree which the West is yet unable to match. Nor do the Soviets suffer from the artificially induced inhibitions about the first use of nuclear weapons which are so characteristic of Western attitudes.
The Soviets have always enjoyed superiority in numbers of their conventional forces. Now the gap in quality and capacity, which was very much in favour of NATO for many years after the war, has diminished until it has largely disappeared.

Mr. Edwin Wainwright: I do not think that the hon. Member is telling the truth about this. Is it not true that the air-launched cruise missile is far better than any version that the Russians have got and that the sea-launched missile with a range of 2,300 miles is also far better?

Mr. Critchley: I am coming to the cruise missile. In reality there is no such thing. One or two have been fired but they are certainly not in service.
The Warsaw Pact has a number of advantages over its NATO rival. It is more centralised in the sense that geographically it can act more quickly and is capable of much more rapid reinforcement. By virtue of the dominance of the Soviet Union, its weapons are standardised and inter-operable. Many of ours are not. Warsaw Pact manpower is less expensive than ours and therefore a far larger share of the money can be used on a programme of research and on the procurement of modern weapons. That is not in dispute.

Mr. Frank Allaun: The hon. Member said that this is not in dispute. It is. According to the Institute of Strategic Studies the manpower in the Warsaw Pact forces is 4·7 million, while in NATO it is 4·8 million. The hon. Member just said that the Warsaw Pact greatly exceeded NATO.

Mr. Critchley: The hon. Member for Salford, East (Mr. Allaun) is including in the NATO forces the Greeks and the Turks. They are nowhere near the central front of Europe, and with the best will in the world, they could not be called upon to reinforce our forces in this area.
There is no visible end to the process of Soviet rearmament. It is not necessary to remind the public of the extent of the Soviet build-up. We cannot have failed to have heard the warnings. Generals, politicions and journalists have all been telling us the strength of Soviet forces and the growing strength of their armaments. On the central front their armaments are numerically superior in a ratio of 3 to 1, and their artillery in a ratio of 6 to 1. The quality of Warsaw Pact equipment rivals that of NATO. Soviet rearmament is the most uncomfortable fact of international life. The group of Soviet armies in Germany is poised like a huge arrow at the coalition of allied armies.
I wish to carry the Government with me. Do I overstate the nature of the threat? If so, I would be happy to give way to the Government Front Bench. Clearly, it has not been overstated. In fact it has been understated.
Had it been overstated it would have been reasonably asserted that defence spending was adequate to the task. It has not been so asserted. Dr. Luns does not think so, neither does General Haig. The President of the United States was the first to ask the NATO Powers to increase their defence spending by up to 3 per cent, in order to meet the growing Soviet threat. This Government have agreed to increase their spending by 3 per cent., whatever that means. It means that the British Government no longer believe that British defence spending is adequate.
We are left with the last two excuses. The first is that our effort compares favourably with that of our allies. One can compare this as a percentage of GNP—which is most favourable to the Government's case, although they carefully never compare like with like—or one can compare spending per head of population. Using the latter comparison, we now lag behind not only the United States, France and Germany but the Dutch, the Belgians and the Norwegians.
What is the truth? How should we measure the Government's failure? It is futile to determine defence spending on the basis of an arbitrary mathematical formula based on a GNP percentage. The aim should be to assess the nature of the threat and the resources other allies are making available, and then see what future contribution we can make.
One should bear in mind that these were the words of the Minister of State as reported in the Financial Times on 23rd September last year. He was seeking to answer a pamphlet on defence issued by the national executive of the Labour Party called "Sense about Defence". The Minister of State is at his best when defending collective security against the attacks of his neutralist colleagues. He might try doing it more often.
It is worth having another look at "Sense about Defence" if only to understand more fully the nature of the coalition that is the Labour Party. It calls for a cut of £1,000 million over and

above the £9,900 million already lopped off the defence budget. Such a cut would make our contribution to NATO worthless. This enmity towards defence, to collective security, is a characteristic of the Tribune Group, to which about 80 Socialist Members of Parliament belong.
Perhaps the Minister of State would join me for a moment in speculating about the motives of the Tribune Group. What does it want to achieve? What sort of Britain does it want? I suspect that its members are the same people who were described somewhat unsympathetically by Hugh Gaitskell as
a collection of neutralists, unilateralists and fellow travellers".
When one opens "Sense about Defence" and sees that it has a foreword by the hon. Member for Bethnal Green and Bow (Mr. Mikardo), one does not know whether to laugh or cry. The Tribune Group is mounting a threat to the sort of defence and foreign policy which the Labour Party has always stood for. We all know this, but what is so annoying is that its members are allowed to pretend to be either radicals in favour of spending less money, or moralists uniquely concerned with the wickedness of weapons. In fact, they are neither.

Mr. Frank Allaun: Since the hon. Gentleman has smeared my hon. Friend the Member for Bethnal Green and Bow (Mr. Mikardo)—a man who has done more for peace than the hon. Gentleman has—perhaps I may be allowed to intervene. The hon. Gentleman asked what were our motives. Let me tell the House simply and honestly that our motives are to avoid a third world war and to maintain and improve detente. I suggest that the speech the hon. Gentleman is making is intended not to further detente but to ruin it.

Mr. Critchley: It is surely the object of every hon. Member to avoid a third world war. We are debating the best way to achieve precisely that.
I am saying that the members of the Tribune Group are not moralists uniquely concerned with the wickedness of weapons. They are neither. They wish to forward neutrality. They favour neutrality either as an end in itself or as a first step towards Britain changing sides. The Tribune Group fears and


dislikes the United States more than it fears the Soviet Union.
What is as bad as the adoption of neutrality by a large proportion of the Labour Party is the failure of the Social Democrats not simply to win the argument but even to start it.

Mr. Alan Lee Williams: Did the hon. Gentleman, when reading "Sense about Defence", note that a number of hon. Members, including myself, wrote an annex to that document which clearly put the Social Democratic case?

Mr. Critchley: I concede that there is no better Social Democrat than the hon. Member for Hornchurch (Mr. Williams). I still assert that most of the Labour Party has been seen off the field. Indeed, the right hon. Member for Stockton (Mr. Rodgers), who, in conjunction with the hon. Member for Hornchurch and the hon. Member for Farnworth (Mr. Roper) might have saved the Labour Party, has been given the task of sorting out the Driving and Vehicle Licensing Centre at Swansea.
There are three forms of neutrality, and nobody ever asks what it is the Tribune Group wishes to achieve. Its members are allowed to pretend that they are in favour of something else. Yet if the Tribune Group is hostile to capitalism in this country, should it be so surprising if its hostility is universal? Do its members favour a disarmed Britain, or a half-armed neutrality without nuclear weapons—certainly not members of any alliance that depends on nuclear weapons—or are they in favour of a fully-armed neutrality?
We do not know what sort of neutrality they favour because nobody has bothered to ask them. The group is never obliged to defend its position and say which of the three kinds of neutrality it espouses. Yet were Britain to become neutral and quit NATO, the obvious effect of such a radical change in British foreign policy would be to upset the balance of power in central Europe and to make the situation less stable. Is that what the group seeks? Were NATO to survive our departure, who would have to be recruited to fill the gap? A larger number of Germans would. I would

welcome that, but is that what members of the Tribune Group want? Have they thought it through? Perhaps, after we had withdrawn from NATO, they would favour a fully-armed neutrality on the Swedish model. But do they know how much that would cost?
Despite all that those hon. Members claim, money has little or nothing to do with their attitude and arguments. They favour a fundamental realignment of Britain in the context of the East-West dispute.
There are other fallacies. There are those who believe that, were Britain to become neutral, other countries would follow suit. Others say that, once our virginity was restored, our influence in the world would be much greater. No country, Socialist or otherwise, has utterly disarmed, so no one would conceivably follow our example.
Do we really imagine that the restoration of our virginity would increase our influence in the councils of the world? Our European allies would be appalled; the Russians would regard British neutrality as being in their interests but would offer no quid pro quo. Those in the United States who wish to reduce their obligations to the common defence would be heartened, while the Administration would have to decide whether to rearm further.
The Tribune Group in fact feels neutral between the United States and the Soviet Union. It wants Britain to leave the Common Market and the Atlantic Alliance. At best it sees American free enterprise and Russian dictatorship on all fours, and at worst it wants Britain to change sides in the cold war. If those on the Right wing of the Labour Party are not prepared to take the intellectual battle into the enemy's camp, we in the Tory Party will have to do so.
The Labour Party is no longer the party of Attlee and Bevin. It is not yet—although it is moving fast in that direction—the party of Hart and Mikardo. It remains the party of Mulley and Gilbert—sleepy, good-natured and confused.
There is one final argument. Clearly, the threat has not been overstated. Equally plainly, our spending is not adequate to the task at hand. Our effort in no way compares favourably with that


of our allies. Are we then at least doing "all we can possibly afford"? Again, the answer is "No."
We can no longer plead poverty. Is the economy not to grow in future? Are we not assured by Ministers almost every day that the economic miracle has already occurred? The right hon. Member for Leeds, East (Mr. Healey) has already announced an increase in State spending of £1,000 million and we still have the Budget—his election announcement—to come.
At the end of last year, the right hon. Gentleman announced that £400 million was to go to the construction industry. The 3 per cent, increase in defence spending now announced by the Government is "about £200 million. We should do far better than that. The money is there, but the will is lacking. There is no reference in the White Paper—

Mr. Frank Allaun: How much would the hon. Gentleman spend? I suggest that if we quadrupled our arms spend-in and completely bankrupted the country, he would still say "Not enough." All the time that he is talking about the Soviet threat of new weapons and so on, does he not think that his opposite numbers in the Kremlin are using the same hawkish terms about the American weapons? Is it not gentlemen like him and his opposite numbers in the Kremlin who are the cause of all the trouble?

Mr. Critchley: Obviously defence spending has to be set in the context of what a country can afford—[HON. MEMBERS: "Ah".] That is obvious. Have we ever said anything different? All we have said is that we would give defence a higher priority than Labour has done. Is that unreasonable? What is politics, after all, if it is not a process of deciding on one's priorities? If we are to give it our first priority, we shall clearly spend more money—but it will be more money which we can afford.
Defence is more than just men and munitions, however brave the men and effective the munitions. The intellectual and moral factors of defence are of supreme importance. Should we not ask whether the West has the moral fibre that would enable it to resist the encroachment of the Soviet Union? I fear that the changes that have occurred in Western

European societies have weakened the will to resist of both the peoples and the politicians.
There has been a growing materialism, with those values overtaking the spiritual at the expense of a readiness to serve and to sacrifice. Idealism, such as it is, is directed either towards social problems or to the Third world. For many of Europe's youth the idea of service to one's country, and even defence of one's country, has become abhorrent.
Yet another change has been the decline of religion—the secularisation of thought. The West is challenged by Marxism—a religion of sorts. Is it possible to meet that challenge without the transcendental factor in our moral and mental make-up? Religion has been the cement both of men and of nations. Will it be enough to put prosperity in its place?
A third change has been the end of patriotism. The nation State survives but without the legitimacy of public affection. It is appalling that politicians have put nothing in its place. The unity of Europe ought to be an end in itself, just as the unification of Germany, Italy and the United States were ends in themselves, but we have sold Europe not as a super State, to which we should owe love and loyalty, but as a super market.
We have also become hypercritical of our own societies and institutions. We have also been deceived into accepting the false notion that the quarrel between NATO and the Warsaw Pact is between capitalism and socialism. In other words, we are prepared to fight for francs and marks, whereas our opponents are the defenders of the rights of the common man. The issue that divides East from West is not capitalism versus Socialism, but liberty itself.
This is a gloomy list of changes. Are the politicians to blame? As power has passed from the Member of Parliament, first to his party, then to the Executive and now to the bureaucracy and beyond, so popular democracy has been substituted for the parliamentary kind. We are only too keen to make sure, first, what it is that the people want and then, secondly, to pronounce ourselves in favour of it. In which country in Western Europe are the public in favour of defence spending when they are not constantly


and courageously reminded of its vital necessity.
If the Government reduce defence spending five times in four years, is it any wonder that the people are inclined to put defence at the bottom of their list of priorities? That is the charge that the Opposition make in this debate today.

9.33 p.m.

The Under-Secretary of State for Defence for the Army (Mr. Robert C. Brown): The hon. Member for Aldershot (Mr. Critchley) spent the bulk of his speech attacking policies that the Government do not in any event follow and that it is not my business to defend. Suffice to say that confession is good for the soul. It was good to hear an honest word from the Opposition Dispatch Box today when, in the dying minutes of his speech, the hon. Gentleman conceded that defence expenditure is allied to the economic state of the nation. It was good to hear the candour and honesty of an hon. Member speaking from that Dispatch Box.
Before replying to the numerous points raised by hon. Members during the debate, I should like to speak briefly about an element of our Armed Forces in which I have a particular interest—the TAVR. The Reserve Army is a vital element in the forces which we would send to BAOR in time of war. It also has an extremely important role to play in the defence of the United Kingdom base. It is an outstandingly efficient force manned by part-time volunteers. I know from my own experience, having exercised with them on more than one weekend, just how good these TAVR lads are.
Every year at this time, we mount a recruiting drive for the TAVR. At present, it is, on average, recruited to some 83 per cent, of establishment, although where I come from it is light infantry territory and we are at about 101 per cent, of establishment.
I was sorry to hear from the hon. and gallant Member for Eye (Sir H. Harrison), who is Chairman of the Defence and External Affairs Sub-Committee, that the Sub-Committee will not be able to pay its planned visit to the TAVR in the North-East. The Committee will be missing a great weekend and I hope that its visit has only been postponed and not cancelled.
I should like to see all units up to full strength as they are in my part of the world. Such is the importance that the Government place upon the TAVR that the Prime Minister has gone on record recently with a major statement of support for them. He spoke of the "crucial role" that the TAVR would play in the nation's defence in war and expressed his hope that the current nationwide recruiting campaign should
receive a good response throughout the country and in particular of employers and trade unions, whose active support is vital to TAVR training".—[Official Report, 23rd February 1978; Vol. 944, c. 765.]
I hope that the House will endorse that call and that hon. Members will seek to make it heard in every constituency. Any man or woman joining the TAVR will find it a tremendously rewarding life and will know that he or she is doing a job for which the whole community will be grateful.
Although I have mentioned only the TAVR I am sure that my hon. Friends the Under-Secretaries of State for the Royal Air Force and the Royal Navy will wish to associate themselves, in relation to their volunteers, with what I have said.
I have mentioned the hon. and gallant Member for Eye and I wish to express appreciation of the thorough investigations carried out by the Defence and External Affairs Sub-Committee under his chairmanship. We value its reports, which are always carefully studied by the Ministry and welcomed in the House as valuable contributions to our debates. We always reply to them promptly. I am pleased that my right hon. Friend the Secretary of State was able to put the hon. and gallant Gentleman right when he appeared to be suffering from a misconception, but I am sure that the House would wish to join me in saying how much we value the service given by the hon. and gallant Gentleman as chairman of an invaluable sub-committee.
Support for the TAVR is surely something on which we can all agree, but criticisms have been levelled at the Government's defence policies and I feel that some of them deserve an answer. No one should mistake the climate signified for defence planning by the tone of the Secretary of State's speech earlier. For reasons of economic necessity, we have been through a period in which the key-note has been to preserve the fundamentals


and to trim unnecessary excesses, thus bringing our defence contribution more into line with the contributions of our allies.
We have achieved that taut, efficient posture. We shall now have greater room for manoeuvre by carefully selected measures to make qualitative improvements to our forces where they are most needed. The 3 per cent, increase in spending will be most useful here. The need for economic management will certainly remain, but the improved economic position of the country will allow a more positive emphasis to be placed on improvements to, rather than preservation of, our capability when, as now, they are rendered necessary by developments in the threat against which we have to defend ourselves. Not that it has been all preservation and no improvement for the past three years—far from it. But it is a change of emphasis in face of an increased threat which the House should recognise.
In reply to the remarks of my right hon. Friend the Secretary of State the right hon. Member for Chesham and Amersham (Sir I. Gilmour) spoke in broad brush terms about his party's plans for defence spending. It sounded good. But what was the substance? When pressed on what his 4 per cent, meant he wriggled and finally tried to slip from the hook by saying that he was keeping his options open. The House laughed. Its laughter is a more eloquent comment on the right hon. Gentleman's hollow claims than I could hope to offer. In the face of the Secretary of State's impressive list of concrete measures to improve our capability, he could only offer vague assurances and hot air. He said, "I do not know what the base line would be from which the 4 per cent. should be calculated". The House will draw its own conclusions when it reads the right hon. Gentleman's speech.
The right hon. Gentleman referred to the problem of underspend. Underspending is not any kind of hidden cut. It simply reflects unavoidable delays in works and equipment programmes outside the control of the Ministry of Defence. Improved financial information systems, introduced with cash limits, should make it easier, for Departments such as the MOD to monitor the progress of spending and to take corrective

action in good time when divergencies appear from planned patterns of spending. We are working hard on such improvements. I should point out that the defence budget has underspent in 12 of the past 14 years. The problem is therefore common to Governments of both political hues. Thus, to seek to attack this Government over it demonstrates only to what a level the right hon. Gentleman has sunk in his attempts to seize on any point of possible criticism, however feeble or bogus. We can leave his speech there for the time being.
In contrast, my hon. Friend the Member for Salford, East (Mr. Allaun) pursued his usual tack, arguing principally that it is NATO that leads in the arms race. Where the USSR spends 11 per cent, to 13 per cent, of the gross national product on defence compared with the United States of America's figure of 5·5 per cent, of GNP, I think we may perceive the true position. An increase of 31 per cent, in its numbers of main battle tanks in Central Europe is not, surely, an earnest of the USSR's determination to eschew the military option as an instrument of policy. It is no pleasure to the Government to have to increase arms spending, but the facts are inescapable and the 3 per cent, is our answer. My hon. Friend should give more credit, though, for the progress we have made in bringing our defence expenditure into line with that of our allies.

Mr. Frank Allaun: I noticed that my hon. Friend appeared to be listening to my speech, but it appears that he did not take much notice of it. Perhaps some hon. Members opposite heard me, too. I said that in certain weapons the Warsaw Pact is stronger than NATO but that in manpower and in most weapons—in the number of missiles, in the number of aircraft carriers, and in new weapons such as the cruise and MX weapons—NATO is stronger than the Warsaw Pact. Just the same argument as my hon. Friend is advancing is, I am sure, being advanced inside the Kremlin. It is this competition—this deadly arms race—which is taking us all on towards the third world war.

Mr. Brown: I cannot answer that in the short time available. My hon. Friend should give us credit for the fact that we


no longer bear the disproportionate share that we carried when we took office.
On the estimates that we have of future economic growth, the increase of 3 per cent, in the defence budget will leave the defence share of GDP at the same level as this year—at 4¾ per cent. As the economy improves, the percentage will decrease in line with what many of us wish.
When I examine the motion in the names of my hon. Friend the Member for Salford, East and others, I cannot help but recall the time when I spent a few minutes on a "Panorama" programme. I was followed by a convener of shop stewards from one of the works mentioned in my hon. Friend's motion. I was castigated because members of that shop stewards union had to work on socially useless products. The workers wanted their skills to be transferred to socially useful products. I do not complain at that sentiment. However, the day after that programme I met the same convener of shop stewards at the main gate to the Ministry of Defence. He was leading a deputation of workers who were demanding more military work to be transferred from a publicly owned factory to a privately owned factory on Tyneside. I then began to wonder. That is having it both ways and that is not fair.

Mr. Frank Allaun: They must be provided with alternative work.

Mr. Brown: Yes, but we cannot do that overnight. I hope that we shall move in that direction.
My hon. Friend the Member for Huddersfield, East (Mr. Mallalieu), in a typically charming and characteristic speech, took us back 30 years to when he made his first contribution to a defence debate in the House. It was an interesting speech. I liked his idea of splitting defence debates into two parts—one on policy and the other on welfare. It is a good idea. I do not know whether this might be my hon. Friend's last contribution to a defence debate, but, if it is, he has our good wishes for the future and our thanks for all his contributions.
My hon. Friend the Member for Loughborough (Mr. Cronin) and the hon. and gallant Member for Eye raised the issue of warning time and referred to the increasing capability of the Warsaw Pact

to launch an attack with little warning. I assure the House that, although a period of rising tension is considered more likely, the possibility of a surprise attack is acknowledged within NATO.
For this reason we have been placing increasing emphasis on improving the readiness of NATO's standing forces. I am glad to give the hon. and gallant Member for Eye the assurance that he requested. NATO's plans for combating a surprise attack are kept under constant review. As long as the Alliance maintains its vigilance and the credibility of its deterrent forces, there is little likelihood that an attack—surprise or otherwise—will occur.
The state of preparedness of the Alliance is, of course, kept under constant review in the light of assessments of warning time. We have the reserve forces we need for the reinforcement tasks necessary. We, can, for example, swiftly reinforce BAOR in time of tension to more than twice its peace-time strength. Our reinforcement plans also include arrangements to return individuals and units away on leave and training as well as those deployed in Northern Ireland. All those movements can be achieved within the timescale required by current NATO planning but, of course, we constantly seek improvements.
The hon. and gallant Member and my hon. Friend the Member for Loughborough also referred to the positive response made by the Government to the programme of short-term measures agreed by NATO Defence Ministers last year. My right hon. Friend the Secretary of State has already detailed some of the improvements we are making in the anti-tank capability of BAOR, the fact that we are making additional armoured, artillery and infantry units available as reinforcements, and that we are improving our plans for reserve mobilisation and reinforcements. In addition, the decision to increase the size of the Army will make it possible to improve the level of readiness and raise the standard of training in NATO-assigned units.
The hon. Member for Portsmouth, South (Mr. Pink) talked about the offshore task. There are two principal tasks—fishery protection and the protection of offshore oil and gas installations. Because these tasks occur in the same waters


—inside our extended fishing limits—and are, to a large extent, based on a common strategic approach, the same forces are used for both tasks. The strategic approach is essentially that of surveillance and patrolling by ships and aircraft, with back-up, as necessary, from other elements of the Armed Forces. In fishery protection, the concept of patrolling includes the requirement to board, search and perhaps escort an offender into port for further investigation.
The new "Island" class of offshore patrol vessels has now entered service to provide a constant presence, and the fifth and last of the class dedicated to the offshore task will enter service in April. These ships are designed for good sea keeping and long endurance in North Sea conditions. They have good communications to enable them to assume control of an incident. We feel that it is these characteristics that are the essential ones for the general policing of our interests in the North Sea, rather than those of high speed and heavy armament which have been advocated in some circles.
RAF long-range maritime patrol Nimrod aircraft reconnoitre over large areas and are a vital complement to the ships, providing information beyond the range of ships' sensors and enabling them to be deployed to the best advantage. In addition to these forces, reaction forces are available at short notice to deal with all sorts of incidents and emergencies. Our experience to date leads us to believe that our measures are adequate. Nevertheless, if circumstances suggest a change of plan we shall, of course, consider it.
I move on now to pay and conditions. The right hon. Member for Chesham and Amersham asked about the independence of the Armed Forces Pay Review Body. The position is clear. The Review Body is free to make whatever recommendations it thinks fit. That is its independence. The Government are also free to give whatever advice they think right to the Review Body. But this does not detract from the obligation on the Review Body to weigh that advice and all the other evidence before it and to make its own decisions as to what its recommendations should be.

Sir Ian Gilmour: The Minister must not go on perpetuating this myth. The

Secretary of State and the Minister of State have agreed categorically—the right hon. Gentleman in his letter to me—that the Review Body is expected to abide by the Government's pay policies. In that case, why go on saying that it is independent?

Mr. Brown: The position is quite clear, as I have said. The Review Body is free to make whatever recommendations it may decide to make. That is the independence of the Review Body. But, equally, the Government have a right to consider the recommendations and to make their decisions. Every right hon. and hon. Member must understand that it is clearly for the Government to decide on the implementation of any recommendations of the Review Body.
Very many hon. Members on both sides of the House have made strong pleas for Service men to be given a fair deal. It is indeed good to witness the support that we have from both sides of the House on the issue of Forces' pay. But the plain fact is that we must wait and see.

Mr. Robert Banks: Will the Minister give way?

Mr. Brown: No.
The Review Body will report soon. The Government will then, and only then, make their decision on the basis of this independent body's recommendations. But my colleagues and I are determined that the Forces will get a fair deal. I can say no more than that at present. I can say no more than the Opposition could say were they in office.

Mr. Banks: Mr. Banks rose—

Mr. Brown: When the Opposition were in the same boat during a statutory control of incomes, the Armed Forces suffered in exactly the same way as they have done over the last two years.
It is no good the hon. Member for Petersfield (Mr. Mates) shaking his head. He was then a serving member of the Armed Forces and he knows well enough what that statutory policy did in terms of comparability, as, indeed, any incomes policy does.

Mr. Mates: Will the Minister give way?

Mr. Brown: No, I shall not give way. The hon. Gentleman may catch Mr. Speaker's eye tomorrow.
I want to thank my hon. Friend the Member for Farnworth (Mr. Roper) for a most imaginative speech. He marked the two important factors—first, the increase in the cost of equipment; secondly, the reduction in manpower in all three Services in the past decade. It was an interesting resume of what has happened in defence spending over the past decade. My hon. Friend clearly underlined the fact that defence spending has remained almost as a constant during the last 10 years.
My hon. Friend the Member for Kings-wood (Mr. Walker) made a very thoughtful speech. It was the first time that I have heard him intervene in a defence debate. I hope that it will not be the last, because his was one of the finer speeches in a generally quite good debate. He mentioned local overseas allowance as it applies to those serving in Germany. Because of the direct intervention of my right hon. Friend the Secretary of State, local overeas allowances have been frozen for 12 months.
Much has been said today to bring out apparent differences between Government and Opposition on matters of defence policy. Despite all the sound and fury, I believe that these are more imagined than real. Looking at the records of both parties in Government rather than listening to opportunist statements made in opposition with little other purpose than to seek temporary electoral or Press advantage, I think that the House would agree that one finds a great element of consensus: for example, strategically, in our support of NATO and our determination to sustain and, now that economic circumstances permit, improve our frontline forces; in Northern Ireland, where we are pledged to support the RUC with whatever level of military presence may be required; and, let us be clear, in the means by which Armed Forces' pay is determined and reviewed.
In all these respects, and in the broad level of resources which we continue to devote to defence—some £7 billion a year; certainly not chicken feed—we cannot in truth be said to have departed from the basic policies accepted over the

years by governments of both parties. We may have slimmed elements peripheral to our basic defence needs, but we have kept the essentials.
Nor have the Opposition shrunk from cutting the defence budget where economic circumstances have made this necessary. The hon. Member for Aldershot was good enough and honest enough to say that. The Armed Forces are unlikely to forget the Demon Barber.
Now, thanks to the Government's sound economic management, we may look forward to a period of stability in which to build. I would regard the 3 percent. increase in defence expenditure for 1979–80 as a clear answer to anyone who impugns the Government's commitment to a strong defence posture. Perhaps it is this very clarity which creates alarm amongst the Opposition and renders their criticism the more raucous—

It being Ten o'clock, the debate stood adjourned.

Debate to be resumed tomorrow.

BUSINESS OF THE HOUSE

Ordered,
That, at this day's sitting, the Commonwealth Development Corporation Bill [Lords], the Northern Ireland (Emergency Provisions) Bill [Lords] and the Refuse Disposal (Amenity) Bill [Lords] may be proceeded with, though opposed, until any hour.—[Mr. Snape.]

Mr. Ian Mikardo: On a point of order, Mr. Deputy Speaker. I understand that at an earlier stage in the debate the hon. Member for Aldershot (Mr. Critchley)—I call him that conventionally—made a personal reference to me which not only disputed my views, which he has every right to do, but impugned my motives in putting them forward.

Mr. Mates: He said what they were.

Mr. Mikardo: The hon. Member gave me no notice that he intended to refer to me in this way, which is contrary to all the traditions of the House. I am not in the least concerned with his reference to me because it is well known that an elephant does not worry about the attack of a mouse. The criticisms of such a light man are not to be worried about. I wonder whether, out of your long experience


of the traditions of the House, Mr. Deputy Speaker, you would be kind enough to advise the hon. Gentleman of the normal courtesies of the House which demand that on such an occasion some notice should be given to the hon. Member to whom reference is to be made.

Mr. Deputy Speaker (Mr. Oscar Murton): I am sure that the hon. Member for Bethnal Green and Bow (Mr. Mikardo) has made his point. I heard the debate and I did not consider that there was any matter which was out of order.

COMMONWEALTH DEVELOPMENT CORPORATION BILL [Lords]

Considered in Committee.

[Sir MYER GALPERN in the Chair]

Clauses 1 to 19 ordered to stand part of the Bill.

Schedules 1 and 2 agreed to.

Bill reported, without amendment.

Motion made, and Question, That the Bill be now read the Third time, put forthwith, pursuant to Standing Order No. 56 (Third Reading), and agreed to.

Bill accordingly read the Third time and passed, without amendment.

NORTHERN IRELAND (EMERGENCY PROVISIONS) BILL [Lords]

Considered in Committee.

[Sir MYER GALPERN in the Chair]

Clauses I to 20 ordered to stand part of the Bill.

Clause 21

PROSCRIBED ORGANISATIONS

Amendment made: No. 1, in page 14, line 37, leave out subsection (9).

Clause 21, as amended, ordered to stand part of the Bill.

Clauses 22 to 36 ordered to stand part of the Bill.

Schedules 1 to 6 agreed to.

Bill reported, with an amendment; as amended, considered.

Motion made, and Question, That the Bill be now read the Third time, put forthwith, pursuant to Standing Order No. 56 (Third Reading), and agreed to.

Bill accordingly read the Third time and passed with an amendment.

REFUSE DISPOSAL (AMENITY) BILL [Lords]

Read a Second Time

Bill committed to a Committee of the whole House.—[Mr. Snape.]

Bill immediately considered in Committee.

[Sir MYER GALPERN in the Chair]

Clauses 1 to 13 ordered to stand part of the Bill.

Schedules 1 and 2 agreed to.

Bill reported, without amendment.

Motion made, and Question, That the Bill be now read the Third time, put forthwith pursuant to Standing Order No. 56 (Third Reading), and agreed to.

Bill accordingly read the Third time and passed, without amendment.

FIDUCIARY NOTE ISSUE

10.3 p.m.

Mr. Nigel Lawson: On a point of order, Mr. Deputy Speaker. I see that the Treasury Minister has now appeared. I could not see him before, and I wondered whether we should have a suspension until the Minister of State found time to be here.
I beg to move,
That an humble Address be presented to Her Majesty, praying that the Fiduciary Note Issue (Extension of Period) Order 1978 (S.I., 1978, No. 224), dated 16th February 1978, a copy of which was laid before this House on 21st February, be annulled.
If the motion were to be carried and the order were annulled, the fiduciary note issue—which, to all intents and purposes, means the totality of bank notes at present in issue—would have to be reduced at a stroke from its present total of well over £7 billion to precisely £1,575 million. Since that might lead to one or two practical difficulties, I shall not be advising my hon. Friends to support the motion in the Division Lobby tonight. But this order and its predecessors and successors under the Currency and Bank Notes Act 1954, which come before the House every other year, provide the only opportunity in the entire parliamentary calendar which is set aside for the discussion of a subject of the first importance, namely, the monetary policy of Her Majesty's Government. That is part of our purpose in initiating the debate, as indeed Parliament clearly intended. For, as I reminded the House when initiating a debate on the immediate predecessor of this order two years ago, at a far less


civilised hour—one is grateful for small mercies—

Mr. J. Enoch Powell: There was a bigger attendance.

Mr. Lawson: Still, on this occasion we have with us the right hon. Member for Down, South (Mr. Powell), whose presence is a great asset. That alone adds lustre to our proceedings.
When we debated the predecessor order two years ago, I pointed out that the Financial Secretary who steered the 1954 Currency and Bank Notes Act on to the statute book, my right hon. and noble Friend Lord Boyd-Carpenter, as he now is, had explained the purpose of these biennial orders in the following terms:
an Order of this kind may give a considerable opportunity for debate in either House, not with the intention of solemnly reducing the size of the fiduciary issue by an arbitrary act, but to allow analysis of the policy 
—in this case monetary—
of the Government. That would be most conveniently effected on this Order."—[Official Report, 26th January 1954; Vol 522, c. 1691.]
The phrase "a considerable opportunity" is, to say the least, a considerable exaggeration. But I suppose that it is better than nothing.
I said that examination of the Government's monetary policy was part of our purpose tonight. The other part is also central to the order, for the order is the last vestige, the last pathetic reminder, as it were, of what was once a real measure of parliamentary surveillance and even control of monetary policy. Therefore, in my brief remarks I shall also put forward some suggestions as to how Parliament might, and in my opinion should, regain a central role in this process. For now that it is once again agreed throughout the House that monetary policy is a matter of the first importance, it is surely right and indeed necessary that Parliament should get in on the act.
When we discussed the 1976 predecessor of this order in the small hours of the morning it was the first such order to have been debated since 1962. Therefore, I felt obliged to say something about the fiduciary note issue as such and its relation to monetary policy, as did the Financial Secretary when he wound up the debate. I hope that tonight, in order

to save the time of the House, we can all dispense with that.
However, it is worth noting the progress that has been made since then. In particular, in our last debate, on 31st March 1976, I and a number of other hon. Members urged the Government to announce target figures for the growth in the money supply, as was already the practice in the United States. The Financial Secretary, who replied on behalf of the Government, was decidedly un-enthusiastic at the time, objecting that our system was different from that of the United States and that in any case the present Government had no fixed rules for their monetary objective.
Well, we now have precise and publicly announced monetary targets. That at least is some progress. Indeed, the the Bank of England in its Quarterly Bulletin last July described the adoption of published monetary targets as
a major step in the evolution of monetary policy
It is an innovation that I am sure is here to stay. We are all practical monetarists now.
But a monetary target is one thing. Adhering to it is quite another. There are worrying signs that monetary growth at present is running well above the target of 9 per cent, to 13 per cent, officially set for the year to April 1978 and, indeed, tending to accelerate. To be precise, the annual rate of growth of sterling M3 for the nine months for which we have figures so far has been running at 14¾ per cent., and for the most recent three months has been 16½ per cent.
That is certainly consistent with wage earnings rising at around 15 per cent, but is emphatically not compatible with the maintenance of single figure inflation, let alone the steady reduction in the rate of inflation that should be the Government's aim. I know that the Minister will claim that the money supply rose still more rapidly in 1972 and 1973. Indeed, that was something that I publicly criticised in the Press at the time. I was not a Member then.
But let me make three points in this context. First, even if that were so, it is no reason whatever to show unconcern at the acceleration of monetary growth now. Secondly, the excessive monetary growth of 1972 and 1973 was the result


of an explosion in bank lending to the private sector in response to the upsurge in the demand for credit by private industry. The prolonged recession of the past four years, by contrast, has meant that no such demand for credit has so far arisen during the lifetime of the present Government. In short, the Chancellor of the Exchequer and the Prime Minister are rather like a pair of ageing spinsters who, never having once received a proposition from a member of the opposite sex, now piously parade their virtue.
Thirdly, it is worth pointing out that the 16½ per cent, annual rate of growth of sterling M3 over the last three-month period is in fact marginally higher than the comparable rate which the present Government inherited when they took office in March 1974.
So the first question I ask the Minister is, what do the Government propose to do to bring the level of monetary growth back within the target range and, still more important, to prevent the acceleration which now threatens? Indeed, since I always like to be helpful, perhaps I can provide the answer as well—at least offer one which, I hope, the Minister of State will accept in the spirit in which it is given.
The prime cause of the recent upsurge in the money supply is the capital inflows caused largely by the continuing weakness of the dollar. Let the Government, therefore, offset this inflow by allowing a corresponding outflow of capital through a relaxation of exchange control. That, at any rate, is my suggestion and I hope that the Minister will accept it on behalf of the Government.
My second question is, does he or does he not accept that inflation will be wrung out of the system and financial stability achieved only if monetary growth is gradually reduced over a number of years to a figure consonant with the real growth of productive capacity of the economy? If he does accept that, does not he agree that it follows that next year's monetary targets—presumably to be announced in next month's Budget on 11th April—must be at the very least lower than this year's outturn? I hope he will answer that.
We learn from the Press that the idea is that next year we are to have what are

now known as "rolling targets". In his excellent Mais lecture last month, the Governor of the Bank of England acknowledged that
some people fear that a move to rolling targets would permit much greater elasticity, so that over a period monetary growth could drift further and further away from a desirable medium-term trend.
I share those fears. The Governor does not. He expressed the hope that this would not happen. But I am afraid that in an election year I do not share his confidence.
Finally, let me turn to the vital question of parliamentary control. Clearly the present system embodied in the order is little more than a farce. The important question is what should replace it. In the 1976 predecessor of this debate I said—since I do not normally quote myself I hope that the House will bear with me on this occasion—
Parliamentary control over monetary policy means in practice that the policy would be expected to follow certain rules. … Parliament would be asked to approve derogations from these rules in exceptional circumstances." —[Official Report, 31st March 1976; Vol. 908, c. 1515.]
The adoption of monetary targets, which has happened since that debate, provides the opportunity to follow just this course. That is to say, in place of the order on the fiduciary note issue the Government could lay before Parliament each year in statutory form the annual monetary target for the coming year. The Bank of England would then, in effect, be charged by Parliament with ensuring that the target was met.
If, during the course of the year, the Government were to take the view that the target ought after all to be exceeded then it would have to come to this House and seek parliamentary approval for an increase in the target. In this way, the reality—and I emphasise the word reality—of monetary policy would at least be subjected to genuine parliamentary scrutiny and debate. Any temptation on the part of the Government to pursue an unsound monetary policy would be tempered by the knowledge that their intentions would have to be revealed to Parliament and through Parliament to the world at large.
This is one important way in which Parliament can be brought into the act. Another complementary way is through


the Select Committee system. As we have already pointed out in that valuable publication "The Right Approach to the Economy" which I am sure the Minister has as bedside reading,
as Parliament evolves a more effective structure of select committees—a development which we welcome—there could be opportunities for regular and public contact between the Bank and an appropriate parliamentary committee".
There is nothing unusual about that except that it does not happen in this country at present. In the United States the chairman of the Federal Reserve Board is frequently required to justify his monetary policy before a Congressional Committee. I want to see the Governor of the Bank of England in a precisely similar position.
The recreation of a real measure of Parliamentary control over monetary policy is desirable not only in itself, which indeed it is, if monetary policy is as important as most people now agree that it is and if Parliament is to assert itself, as I believe it should. It is also important as the only practical means of reconciling a greater degree of independence for the Bank of England with what might be termed the democratic imperative.
On the question of independence, I agree with the conclusion of Dr. Arthur Burns, the distinguished ex-chairman of the United States Federal Reserve, who stated a few months ago:
I would judge it no accident that West Germany and Switzerland, which in recent years also have managed their economy better than most others, happen to have strong and independent monetary authorities like ours".
Surely nobody would maintain that the United States, West Germany and Switzerland are not genuine democracies.
The truth of the matter is that it is an illusion to suppose, as is too often supposed in this country, that democracy means discretionary control by the Government of the day. Parliamentary democracy, which is what we have had always adhered to in this country and attempted to export—not always successfully—to the rest of the world, has far more to do with open discussion and parliamentary control.
In case any of this seems like airy-fairy theorising, far removed from the real world, let me quote finally from a well-known former practitioner, the last Governor of the Bank of England, Lord

O'Brien, who said in an address last December,
I believe there is also a case for governments, that is the executive branches of governments, to share part of their power over central banks and monetary policy with parliaments … This point is particularly relevant for the United Kingdom … I, for one, believe that if the Bank of England were made more directly accountable to Parliament the Bank would, paradoxically, gain a degree of further independence because the Governor would be given a platform which present constitutional arrangements have hitherto denied him.
If the present Government are prepared to travel along this route, which would be in the interests of Parliament and of sound monetary policy alike, then they have our blessing. But if this is too much to hope, then it will fall to the next Conservative Government to embark on this course. Happily we do not have long to wait.

10.23 p.m.

Mr. J. Enoch Powell: This biennial order and the address that the hon. Member for Blaby (Mr. Lawson) has just moved provide, as he has said, the opportunity too often neglected in the past to review the state of monetary thinking, policy and execution.
I think that the hon. Member for Blaby has been unfairly treated tonight. I was surprised, not to say shocked, when I entered the Chamber to find myself in the sepulchral atmosphere only associated with Adjournment debates. Yet there on the Order Paper, beside his name, were those of colleagues embodying all the financial authority and talent of the Opposition Benches. The names of the right hon. and learned Member for Surrey, East (Sir G. Howe), the Shadow Chancellor himself; the hon. and learned Member for Dover and Deal (Mr. Rees); the hon. Member for Horsham and Crawley (Mr. Hordern); the hon. Member for Cirencester and Tewkesbury (Mr. Ridley)—the choicest names from the financial expertise of the Conservative Party—were arrayed on the Order Paper. I expected, as the mere representative of a small minority party, to have the greatest difficulty in finding a crevice in which to insert my views into the debate.
Yet how deserted was the hon. Member for Blaby. His situation was rendered all the more poignant by the fact that it was his duty to deliver from the Dispatch Box a remarkable commitment


of the Conservative Party for the future—a commitment that may be regarded as extremely ill-advised or injudicious, but still a commitment. Indeed, in his conclusion, the hon. Member for Blaby left no doubt that he was authorised to make this declaration at this time of night.
Therefore, we must find consolation against the emptiness of the Chamber in the presence of the serried ranks of financial journalists in the gallery, who have snatched, as though it were a Budget speech, each of the sentences that fell from the hon. Member for Blaby and rushed them to their editors so that comment may appear in the first editions of tomorrow morning's newspapers.
That is enough of some rather heavy, though not perhaps unmerited, irony. On the last occasion of this debate two years ago, when we reinaugurated the custom of debating this order, it was generally observed that the debate was taking place in a fairly novel atmosphere, which prompted me to apply an old saying, namely, that we are all monetarists now. The trend then observed has gone much further and faster in the last two years, till I am beginning to think that it is the story of the sorcerer's apprentice, all too nastily and injudiciously applying lessons imperfectly learned from his master.
Those of us who anticipated Professor Milton Friedman in the doctrines of the relevance of money supply to the phenomenon of inflation were at first delighted to see the Government, first through one spokesman and then through another, voicing these long rejected, not to say despised, doctrines. But delight began to turn to alarm, as in the last year or two the Government have proceeded to announce precise percentage targets for the increase of the money supply, solemnly to confer on these targets with the International Monetary Fund and other illustrious international bodies, and to treat them as levers of financial and economic management. It is as though the fine-tuning, which had been laughed off the stage a few years ago when it was a Keynesian economic exercise, had come back again by another entrance, reurning, as it were from the country, from the right-hand door of the stage, in the era of monetarism.
The hon. Member for Blaby carried this matter further still tonight. He thinks that not only should such targets in precise terms be stated by the Government, or be professed as their objective, but that they should be given statutory validity.
This would be mistaken. It would arouse a misapprehension as to the limits of the possibilities of control of the monetary aggregates; and disappointment at the failure to control the aggregates in this way might rebound to the discredit of the general proposition, which I believe to be all-important, namely, that it is the monetary aggregates which determine the course of prices and of inflation.

Mr. Lawson: I am interested in the right hon. Gentleman's comments. However, when he says that I was advocating precise monetary targets, I think that the word "precise" might be misinterpreted. What I had in mind was the sort of monetary targets that we have at the moment, which are arranged for a growth of between 9 per cent, and 13 per cent. I am not suggesting that a precise figure should be announced, from which there could be no deviation one way or the other.

Mr. Powell: I am obliged for the explanation. So the incoming Conservative Government, should there be one, will provide the legislative framework—presumably in its first Finance Bill-within which a statutory order or some instrument under that legislation would be laid before the House, prescribing the maxima and minima within which, during the coming 12 months, the growth of the money supply, however determined—it will be fascinating to see a statutory definition of "money supply"—is to be kept.
There are many reasons why I believe that this appearance of possible exactitude in the prediction and attainment of a certain increase in the money supply is foredoomed to disappoint.
There is of course the evident fact that the basic datum in the control of the money supply—the public sector borrowing requirement—is itself a difficult figure accurately to judge. We have in recent years seen the Government's estimates falsified—sometimes upwards, at other times downwards—by sums as large as


£2,000 million, and rumour in the financial pages has it that the shortfall may be even greater when we reach the end of the current financial year. If the basic datum—the PSBR—is subject to fluctuations of that magnitude it seems unlikely that anything which is built upon it can be free from at least that degree of uncertainty.
But this uncertainty is multiplied by another, and that is the other operative factor—namely, the success or otherwise of the Government in meeting their borrowing requirement in non-inflationary ways without borrowing from the banking system. The potentialities here cannot be precisely estimated over even a much shorter time ahead than 12 months.
So we have these twin uncertainties, which, married together, are the basis for estimating the growth in the money suply during the coming period. I do not believe that on a basis like that one dare or should erect a statutory requirement to remain within precise percentage limits, even though the distance between them might cautiously be fixed rather wide.
There is a third uncertainty—that is, the time lag between the movement of the monetary aggregate of money supply and its final effect—its residual effect—in terms of prices and the value of money. Many estimates have been made—some far too precise—of the time lag that might be anticipated between a given rise in the money supply and a given fall in the value of money; but experience, I think, can only lead us to the conclusion, after watching these figures over, now, about two decades, that time lag there is, but that the time lag itself is variable and unpredictable. He would be a bold man who would be more precise than to say that it may be somewhere around two years on average.
These being the basic uncertainties which surround the whole matter of the estimating and control of the money supply, I counsel that the idea of fine-tuning should remain in the limbo to which it has been consigned. I have been alarmed to hear the Chancellor of the Exchequer himself talking, in relation to future growth of money supply, in terms of objectives which I fear were dangerously optimistic in their precision. All we can say is that we understand—I hope

—the main causes which contribute to the growth of the money supply and we understand, and sometimes even admit, that the growth lies at least preponderantly—I would say uniquely—at the root of inflation.
The deduction from this is that we should attend jealously to the fundamental datum to which I referred earlier, namely, the public sector borrowing requirement, without an excess of which neither the pyramid of increased money supply nor the inflation which caps it could occur.
In the assessment of this fundamental figure, the public sector borrowing requirement, as it is at present used in economic and financial debate, there are at least two serious deficiencies; and I want to take the opportunity of the debate to take a little further a discussion between the Chief Secretary and myself which started in an exchange during Question Time in December.
The Chief Secretary had been talking about the net borrowing requirement and I asked him whether his estimate of it included the cost of increasing our reserves. I was astonished that the Chief Secretary, a man of quick perception as well as deep knowledge of these matters, appeared to be taken by surprise. He said:
I am not quite sure what the right hon. Gentleman means by 'the cost'. Does he mean the interest rates? Perhaps he will explain a little further.
I acceded as briefly as possible, within the limitations of Question Time, and, unusually, got a second supplementary question by responding to the right hon. Gentleman's invitation. I said:
I mean the sterling that we have to pay in order to be balanced by the increase in our reserves.
Even this did not seem to help the right hon. Gentleman. He said:
To be honest, I do not normally find the right hon. Gentleman as confused as that, but I am not at all clear what that has to do with the PSBR."—[Official Report, 8th December 1977; Vol. 940, c. 1638.]
That brings me to my point. The cost of increasing our reserves—the cost of buying-in foreign currencies for sterling in order to manipulate the exchange rate, of which a concomitant is an increase in our reserves—has a great deal to do with the public sector borrowing requirement in the full sense of that term; for it


increases the cash requirements of the Government in any given period of time. I am glad that, in subsequent correspondence, the Chief Secretary admitted this fact. He said:
You were of course"—
what a wonderful phrase "of course" is—indispensable to civil servants drafting ministerial replies. Here was the Chief Secretary, who had found me more confused than usual, writing to me on 20th December, 12 days later and saying:
You were of course quite right in saying that foreign currency has to be bought for the reserves, and the sterling with which to buy it has to be borrowed.
Exactly. So here is a borrowing requirement of the Government—which can be a huge one if big sums are being added to thereserves at periods when sterling is what is strangely called "strong"—which does not feature at all in the estimates of the PSBR or in the arguments and deductions which are based upon it.
So I take the opportunity of this debate to repeat that not merely our control but our discussion of money supply is severely hampered if the PSBR for the purposes of that discussion does not include retrospectively and—if we are to make estimates—prospectively the cost—positive or negative, for it can be negative when the reserves are rising—of rigging the exchange rate, by increasing or reducing our reserves of currency.
There is another absentee, much to be deplored, from the total which makes up the PSBR. That, too, I brought to the attention of the Chief Secretary who, in the same letter as I have quoted, acknowledged its importance.
The redemption of maturing debt
—he admitted—
including that of nationalised industries as well as Government debt proper, also necessitates borrowing.
So there is another borrowing element which increases the Government's cash requirements in a particular period of time and has to be added to the total that they are seeking to borrow, which accordingly brings with it the possibility, the danger, the probability, however one may assess it, of an increase in the money supply through that borrowing being met from the banks.
It was in this debate two years ago that I suggested that this is another magnitude which should be included in estimates of the PSBR. There is a great deal of mumbo-jumbo about the Government's transactions in the money market. There has been hitherto a kind of secrecy and mystique—exceeding that which surrounds the gestation period of the Chancellor of the Exchequer before a Budget—about what the Government are trying to do in the money market: what the sums really are that they are trying to borrow and how those necessities arise I see no reason why the Government should not indicate to Parliament at the beginning of a financial year the quantity of maturing debt which they expect will have to be discharged in cash. That is just as important a figure and no more difficult to estimate than the other items entering into the PSBR and the other factors which will determine the growth of the money supply.
So my plea this year is that, since the PSBR is the one thing we can get hold of—it is the one accessible magnitude in this whole business of the causation of growth of money supply—we should define it correctly for this purpose. There may be other purposes for which a different definition of the PSBR is appropriate; but if we are talking about the money supply, if we are talking about the PSBR as the generator of growth of the money supply, it must be the total, the gross borrowing requirement of the Government at which we look. I see that the hon. Member for Blaby is dissenting, which only shows how important it is that we should take full opportunity of these debates and have a full chorus in order to debate these profound and important matters more thoroughly than is possible, if not in a duet, at any rate in the trio that is to be sung tonight. At any rate, I have concluded my contribution to the part-song, with the adjuration that we should always use the gross total borrowing requirement of the Government as estimated from time to time, and that the Government, while pursuing control of total expenditure, total monetary requirements, so as to leave it within its own power either to increase the money supply or not, should eschew objectives which are so precise in their expression and nature that they give the public a misleading notion of the limits of what is practicable.

10.46 p.m.

Mr. Anthony Kershaw: I am sorry that the right hon. Member for Down, South (Mr. Powell) should feel so aggrieved that the whole of the Opposition—and probably the Government—Front Bench are not here to hear him. I did not expect them to be here so I feel no embarrassment.
The proposal made by my hon. Friend the Member for Blaby (Mr. Lawson) that arrangements should be made for the Governor of the Bank of England to have regular opportunities to appear before a Committee of the House, and before the public, to explain his opinion of monetary policies would be wholly beneficial to the conduct of our business.
Of course, the Governor's opinions would not be binding upon any Government. That would not be acceptable to our system. But the argument in public of these complicated matters, which the public understand with difficulty, would be wholly advantageous to the conduct of our business. It would certainly make the public more aware of the problems and perhaps the business community in particular would have more confidence in the policies of the Government of the day. I hope that the Minister will respond to this suggestion.

10.48 p.m.

The Minister of State, Treasury (Mr. Denzil Davies): As he did two years ago, the hon. Member for Blaby (Mr. Lawson) explained the purpose of the order and made it clear that he did not wish to vote against it. He said that the total volume of notes in circulation if the order was annulled would have to be reduced from the present £7,800 million to £1,575 million and that the purpose of praying against the order was to have a debate on monetary policy.
The hon. Member then said some interesting and startling things about the Opposition's policy. He gave a commitment, which the right hon. Member for Down, South (Mr. Powell) mentioned. By using spurious figures, the hon. Member for Blaby said that monetary growth was out of control. He based his argument—if it could be called an argument—on the January money supply figures. The hon. Member knows that these were higher than the trend that one would expect for a 9 per cent, to 13 per cent, target.
The hon. Member also knows the reasons for this. It was partly because of the tax rebates coming through, partly as a result of inflows and partly as a result of the weakness of the dollar—which is part of the external inflow problem. The hon. Member fell into the trap for which the right hon. Member for Down, South criticised him. He fell into the trap of looking at one month's figures and seeking to reach all kinds of conclusions from them. He fell into the trap of turning monetarism into the kind of fine-tuning that has been criticised in the case of Keynesian management.

Mr. Lawson: This has nothing to do with fine-tuning. I did not base my argument on one month. The Minister of State gave me a Written Answer on 6th March which showed that, whether one takes the three months, six months or nine months to December, thus leaving aside the January figures, the rate of growth of sterling M3 on an annual basis, seasonally adjusted, was well above the 9 per cent, to 13 per cent, limit. There is no point in the Minister of State's saying that I used only the January figures. They were special, but the argument applies if those figures are left out.

Mr. Davies: The figures that the hon. Gentleman used were based on the figures for April 1977, which was in the banking year 1976–77. The figures are, therefore, quite meaningless in terms of the discussion of monetary growth in the banking year 1977–78.
I feel sorry for the hon. Gentleman. He has for a long time advocated monetarism, but he has had little support from his right hon. and hon. Friends. In Government they paid very little heed to monetarism. In Opposition, it seems, they have left him entirely on his own on the Front Bench to pronounce a very important policy statement. They have completely deserted him, so that one wonders what part monetarism still plays in the higher councils of the Conservative Party. I pay tribute to the hon. Gentleman because he has stuck to his line inside and outside the House, and I am sorry that his colleagues do not support him.
The hon. Gentleman said that next year they wanted a reduction in the monetary targets, but he never mentioned fiscal policy. A few weeks ago we debated


an Opposition motion calling for substantial and continuing reductions in direct taxation. That is a fair motion. It was signed by the hon. Member for Blaby as well as by the right hon and learned Member for Surrey, East (Sir G. Howe). If the Opposition are so serious about monetary policy, how can they possibly table a motion relating to direct taxation without mentioning monetary policy? They are falling into the trap of thinking that monetarism is quite separate from fiscal policy, whereas the two have to pull together.
The hon. Gentleman made a further pronouncement, saying that he and his right hon. and hon. Friends wanted greater parliamentary control of the monetary targets or of monetarism, I am not quite sure. Then he asked for a statutory target on monetary growth. The right hon. Member for Down, South dealt very effectively with that ridiculous suggestion. These are not matters that can be put into statute. A certain amount of precision is needed in statute. One cannot have a vague statutory provision in this area. Once too rigid a precision is introduced the problems of fine-tuning and the difficulties mentioned by the right hon. Gentleman arise. As far as I am aware, no country in the Western world has this kind of statutory backing or statutory control over its monetary targets.
The hon. Gentleman said that he wanted a debate on the Bank of England monetary policy. The Bank of England, of itself, does not have a monetary policy. The constitutional position is clear. Monetary policy is the responsibility of the Government. The Bank of England advises the Government on monetary matters, and my right hon. Friend the Chancellor takes very full account of the Bank's views. But I do not think it right to try to compare the Bank with the Federal Reserve or with the German Bundesbank, both of which have their own monetary policies under their respective constitutional arrangements. Our arrangements are quite different. I do not believe that we can go down that particular road.
As far as I could see, the hon. Member was arguing that democracy is all very well provided that we take the control of money out of the hands of the people.
People may control other things, but when it comes down to the control of money, which goes to the heart of economic management, that is to be taken out of the hands of the people and put into some other institution.

Mr. Lawson: This is a very foolish argument, which the Minister has made on previous occasions, I think, in Committee. I hoped that I had dealt with it adequately. I addressed myself specifically to the point about democracy, but is the Minister really seriously saying that the United States, West Germany and Switzerland are not democracies? If he is not saying that, he should withdraw his suggestion that what I am saying in any way derogates from democracy or democratic control.

Mr. Davies: I have no wish to indulge in a debate with the hon. Member about what democracy means. But the American constitution is quite different. It was drawn up at a different time, and and there was a deliberate attempt to put monetary control outside the Executive, the legislature, and to create a fourth arm of government which was outside the control of those bodies.
The hon. Member may think that that is a good thing. I do not believe that it is. I believe that these matters should be debated in the democratic forum of the people, and that the people should have control over monetary matters. As I see it, the hon. Member was suggesting, on the one hand, that we must have a statute, which I think is quite unrealistic, and, on the other hand, that the Bank of England should be independent in these matters. I do not see how the hon. Member can have both of those things. Again, it is the kind of confusion that is at the heart of Tory monetary policy which we have seen in the past.
The right hon. Member for Down, South made the very fair point that there is a possibility, if we rely too much on targets, and too much on monthly figures—he did not say that—that we shall fall back into a kind of fine-tuning danger that is involved in a more Keynesian control of the economy.
The right hon. Member also raised the point regarding the public sector borrowing requirement. To some extent, it is a matter of the definition of the PSBR. I do


not want to follow the right hon. Gentleman along those lines. However, he is quite right when he says that if foreign currency is taken into the reserves, this has an effect on sterling M3, certainly. If we repay our debts not out of the reserves but through intervention, that will have an effect upon our M3 targets and upon the level of M3.
Therefore, to that extent I certainly agree with the right hon. Gentleman that transactions in the foreign exchange markets have an effect upon money supply. Whether one goes further and redefines the PSBR to take account of that is another matter, and, I suggest, a subsidiary and secondary matter, and perhaps not as important as the realisation that operations in the foreign exchange market can have an effect upon the PSBR.
As I pointed out in reference to the January figures, the weakness of the dollar, for instance, had some effect upon sterling M3 for that month. Again, inflows as a result of a balance of payments surplus can have an effect upon M3.
The hon. Member for Blaby said that we could solve those problems by abolishing exchange control. I am not so sure about that. But that is another argument.
I hope that I have tried to deal with some of the points that have been raised. I certainly reject the commitment of the hon. Member for Blaby and the Tory Party now, it seems, to a statutory target for monetary growth. I think that that is foolish and silly. It ignores other areas of economic management, and I do not believe that it is really practical. I wonder whether the hon. Member was serious in putting it forward. But it seems now to be a commitment on the part of the Conservative Party.
The hon. Member said that he would not vote against the order. For obvious reasons, it is a technical order that does not in itself affect the money supply. But I recognise that the House wishes to have this kind of debate, and I hope that the order will now be accepted.

Mr. Lawson: I beg to ask leave to withdraw the motion.

Motion, by leave, withdrawn.

OVERSEAS STUDENTS

Motion made, and Question proposed, That this House do now adjourn.— [Mr. Harper.]

10.58 p.m.

Mr. Anthony Kershaw: I wish to call the attention of the House to the treatment which overseas students in this country are receiving. I shall argue that the policy of Her Majesty's Government towards them is unjust, even illegal, and that the consequences are hurtful to the students and harmful to the interests of the United Kingdom.
In fact, it is difficult to know what the policy of Her Mejesty's Government is, because they have not at any time spelt out the basis of their approach. In 1976, the Secretary of State announced various increases in fees, the result of which is that overseas undergraduates pay £650 compared with £500 for home students, and graduates £850 compared with £750 for home graduates.
However, in November 1976 the Secretary of State said that it was her intention, in due course, to remove the fee differential. Even if this is a rather a hollow promise, because fee levels effectively apply almost solely to overseas students since the vast majority of home students have their fees paid by public funds, nothing has yet been done towards fulfilling that promise. The Minister of State last July was only able to say that increases for the coming year would be made to take account of inflation.
We have had inspired Press leaks which indicate that future policy will be towards positive discrimination in which rich students from richer countries will be charged very much higher fees, calculated to produce £120 million in a year, which will be used to subsidise poor students from poorer countries. I ask how it will be possible to determine the real income of students, how it will be possible to make it compatible with the free entry to universities of students other than those nominated by their home Governments. That is something I cannot understand.
How are the countries to be nominated? As someone pertinently asked, are we now to refuse education investment into the United Kingdom from the


United States in projects such as those from the Brookings Institute?
How do we stand with regard to the EEC? Are we to continue to charge high fees and to keep on raising them against other countries—against countries such as Germany and France, who receive a far larger number of British students than we take from them and who charge nothing or almost nothing? If those countries retaliate, what will be the effect on our students wishing to go abroad? Has that been considered?
Is the conduct of the Government in this regard compatible with membership of the EEC? The only thing that the Government have done to mitigate hardship is to replace the widely used overseas students fees award scheme with the fee support schemes for postgraduates only. This has proved totally inadequate. The burden of easing hardship has been shuffled off on to local authorities, who are inappropriate for the job, and upon universities and polytechnics, who have struggled to help but without the slightest assistance from Government, except the so-called £1 million divided between universities and the State sector, which was not additional real money but was what would otherwise have been cut. What is certain is that the Government wish to limit the number of overseas students.
The public expenditure White Paper of January 1978 shows the decline in the number of overseas students anticipated, from 52,000 this year to 44,000 in 1981–82, in higher educational establishments, and from 28,000 to 22,000 in non-advanced institutions. Why have these figures not been made public by the Department responsible and justified by argument? Why do we learn of them from a Treasury table? I shall tell the Minister why this is so. These instructions about quotas come from the notorious and largely incomprehensible Circular 8/77. This circular not only imposes quotas but authorises differential tuition fees, local education hostel charges and admission charges. It encourages reclassification of certain categories of immigrant students so that they may be charged higher fees. The circular apparently includes in the quota students who are wholly paid for by their own Government, imposing no charges

on the British taxpayer and bringing in investment earnings.
For example, 1,500 Nigerian students are due here in September, bringing in £7 million a year. But they are to be part of the quota, apparently, a quota presumably designed to limit our costs. In fact, they are a profit.
The reason why the Department of Education and Science will not explain its circular and give guidance to LEAs and others is that, paradoxically, it acts not in the name of common sense but for fear of offending against the Government's Race Relations Act, which was designed to prevent, not promote, discrimination.
I call upon Her Majesty's Government, who so recently worked themselves up into a phoney lather about immigration and race, to withdraw Circular 8/77, which I say is morally and legally offensive. There sit the racists tonight—in the Department of Education and Science.
The harassment of overseas students is becoming a scandal. Their hours of attendance are checked. They are forbidden to apply for continuation courses until their examination results are through, by which time they may well be too late to apply for the next course.
The Inner London Education Authority, that creature of this Government, fined two London polytechnics £50,000 for accidentally exceeding their quota of overseas students, though I understand that one has now been let off paying that amount. Referring to this shameful incident and to the whole matter, The Times Higher Education Supplement wrote:
Either they'
—that is, the polytechnics—
must work an unworkable racist quota, and thus perhaps fall foul of the law. Or they can refuse to work it and be fined.
In short, overseas students in this country are being treated not as honoured guests but shabbily, as if every one of them was a potential illegal immigrant. This curmudgeonly attitude is directly contrary to the short-term and long-term interests of the United Kingdom.
In the long term, the kind of reception and treatment which students receive here will have an important influence on those who, in later years, will be prominent in the counsels of their countries. Our industrial, cultural and political influence in


the world will to some extent depend upon what they have thought of us.
In the short term, the Treasury calculations of the costs of overseas students are manifest nonsense. These calculations appear to take no account of the money which students spend while they are here. The calculations depend upon the total costs of an institution being divided by the number of students to give a cost per head, ignoring that the buildings, the professors and the other overheads would still be there even if not one overseas student came. It is very arguable that, far from there being an expense, there is a net profit from overseas students.
Certainly, the calculations take no account whatever of the academic value to us, especially of post-graduates. Great institutions such as the London School of Economics would be lamed and crippled if their numbers of foreign students were drastically curtailed. It is not only a matter of academic benefits. The material benefits of post-graduate research can be demonstrated to have brought much benefit to us, notably, perhaps, in medicine.
No British student, so far as I have been able to ascertain, has been excluded from a course by too many foreigners. On the contrary—many courses from which British students take benefit could not be kept going without the foreign entry. But even if it were to happen that British students replaced foreign ones, that would bring not savings but extra expense, for we should be substituting subsidised British for fee-paying foreigners. The Government's argument is economic nonsense, founded upon a false premise and wholly against the interests of this country.
What is to be done? The first thing is to decide who in the end is responsible for policy. At least eight Departments, starting with the Department of Education and Science, the Foreign and Commonwealth Office, the Ministry of Overseas Development and the Home Office, have different and conflicting interests and responsibilities in this matter. Someone must be found to take overall charge if the drift is to be stopped.
It is natural to look to the Secretary of State for Education and Science to do this, but she has been a great disappointment. When she came to office she was

widely regarded as a person in whom people of differing opinions could place confidence. When she leaves office, as shortly she will, she will be remembered as the best receiver of delegations in the business. Everyone goes away satisfied, but after a bit everyone notices that nothing happens.
The Secretary of State gives the lie to the old saying
There is no smoke without fire".
With her, there is nothing but smoke. There is no fire of action, no flame of determination, and apparently no influence in the Cabinet. However, some Department must take the lead, whether the DES or another Department.
My second suggestion is that, as there are so many conflicting influences, a commission of all those professional, academic and voluntary bodies directly interested, perhaps with the right to summon civil servants, should be set up to give advice. Such a body would provide a focal point where the interests of the universities, of educationists generally and perhaps also of this House and of the Government Departments concerned could be thrashed out. The Minister would benefit as a result.
Certain it is that at present Government policy is obscure, unfair and contrary to the interests of this country.

11.12 p.m.

Mr. Gerry Fowler: I think that the hon. Member for Stroud (Mr. Kershaw) knows that I share many of his views, though not his view about who created the recent lather about immigration and race relations. On that matter the hon. Gentleman was singularly absurd and he damaged his own case. He should have a word with his right hon. Friend the Member for Finchley (Mrs. Thatcher).
I want briefly to make two simple points. First, does my hon. Friend the Minister agree that in the long run we must carefully examine the question of what proportion of the income of higher education institutions should come from fees? The position in the second half of the 1980s, with a declining 18-year-old age group, will be very different from that of the early and mid-1960s, in the immediate post-Robbins period, a period of great expansion, when it was arguable, as in Robbins, that 20 per cent, was


about the right proportion. It may not be in the latter part of the 1980s. Will the Government consider that while there is still good time to do so?
Secondly, will the Government examine the policy of certain education authorities, notably ILEA, which are not exactly consonant in terms of the quotas they impose—I put the matter mildly—with Government policy? They may sometimes appear to be unduly restrictive and damaging both to good overseas relations and the interests of higher education institutions.
I am sure that my hon. Friend will be able to make at least some sympathetic noises on both those points.

11.13 p.m.

The Minister of State, Department of Education and Science (Mr. Gordon Oakes): I am well aware of the deep interest of the hon. Member for Stroud (Mr. Kershaw) in overseas students. It is an interst that I share. But I listened with some amazement to some of the things the hon. Gentleman said tonight, not only about immigration policy—a matter that he accused the Labour Party of raising—but about public expenditure, because it is largely from the Conservative Benches that the complaints about public expenditure come.
To satisfy the hon. Gentleman, I should like to begin with a positive statement of the Government's attitude to overseas students and our basic approach. Over recent years there has been the growth of a suggestion that we do not welcome the presence of these students. The hon. Gentleman tended to suggest that the Government were opposed to overseas students. Let me make it absolutely clear that these students, who come in their thousands to our universities, polytechnics and other establishments of further education to take advantage of a wide range of courses at different academic levels, are certainly welcome.
It is a long tradition of academic institutions generally and of the United Kingdom in particular to admit students in this way, and successive Governments, including the present one, have watched the numbers go up each year. So let there be no mistake about it; we do not seek to go back on that tradition. What we are doing is to decide where it is right

to draw the balance in terms of numbers and total costs involved—which, I may say, are considerable—and to seek a fairer, more rational policy in this regard for the future.
Let me, however, begin with the immediate issue of fee levels. Even the previously announced revision, which took effect last year, which was necessary as part of our reduction of public expenditure, and which applied to home students also—indeed for many of them the increase was much greater than for overseas students. It still means that only between 20 per cent, and 25 per cent, of the total costs of the education provided is met by way of fees. At one time there was a prospect of further considerable increases for 1978–79. But as long ago as last summer I told the House of the Government's hopes that fees would not have to be increased for 1978–79 in real terms. I am happy that we have been able to recommend just that. In Circular 2/78, which was issued in January this year to local education authorities—a similar document was sent to the universities—my right hon. Friend was able to recommend that no further increases be made above current levels beyond what was needed to maintain the existing rates at constant prices, which meant an increase of just under 9 per cent. Thus, while I am very willing to discuss the wider issues involved, I felt it right to point out at the outset that criticism of our latest adjustment does seem misplaced. We had to recommend that kind of small adjustment because without it fees would have been reduced in real terms. For economic reasons, that was not a practical proposition. But we have kept faith and done no more than this.
I understand that the hon. Gentleman is opposed to the existence of the fee differential for overseas students, and he may wish to see it abolished on this occasion. Indeed, I wonder why he did not wish to see it abolished at any time since its introduction in 1967, when the hon. Gentleman himself, though not in my Department, was a distinguished member of the previous Government, in the Foreign Office, where he would have been in a very strong position to advocate that very policy. But that was not done.
Successive Governments have tried to count the cost of such a concession and


have not been able to give it the necessary priority against other concessions that might be needed, for instance to the vast numbers of home students who pay their own fees—for let it not be thought that all students, or even all those on full-time advanced courses, qualify for mandatory grants.
Let me tell the hon. Gentleman and the House of the costs to public expenditure of abolishing the differential. We estimate that it would cost approximately £12 million a year just to abolish the differential for overseas students. If, as the latest NUS proposal suggests, we abolished all tuition fees, the costs would be £50 million a year for home students and £60 million a year for others, making a total of about £110 million in all.
I ask the hon. Gentleman to be careful, whether he talks about all students or whether he merely talks about overseas students. He represents a party which tells this House that the Government spend too much. He is saying that his party would reduce public expenditure, although it would spend more on the police, defence and many other matters, indeed, the hon. Gentleman is saying that even though the cost would be £12 million, he would spend more money on overseas students by abolishing the differential, which, unfortunately—I repeat that—this Government have had to retain.
Although the Government are considering alternative ways of supporting overseas students, the differential has not been as unreasonable as some have suggested. We welcome overseas students here, but I do not think we should treat them more favourably than home students. Home students themselves, or their parents, do contribute to the cost of providing education through United Kingdom rates and taxes, while overseas students do not, so a differential charge for overseas students does help to even things up.
Moreover, the fee paid by overseas students has to be considered alongside the cost of provision. The hon. Member was given figures in reply to his Question in the House on 14th February on the cost of providing higher education or technical training for an overseas student for a year. These figures were on the low side, because they did not include debt charges or capital costs but even then, for example, the gross average institutional

recurrent cost for an overseas student OH a university course was nearly £2,500. The actual cost of some courses, say, medical or veterinary, could be double that, so the current differential of £100 for postgraduates and £150 for undergraduates is by no means disproportionate.
Let me also deal with the other arm of Government policy to which the hon. Member referred, which is often charged against us, namely, that of limiting total overseas student numbers. It would be as well to remember the reasons for this. It was, of course, part of the whole fees package announced in 1976 and designed to start producing public expenditure savings in 1977–78. I will not go over that ground again.
Lest it be thought that our sole purpose is to reduce the number of overseas students to some wholly restrictive number, well below that of our traditional response, let me remind the House that the figure for which we are aiming, namely, the level reached in 1975–76, is 72,000. Let us compare that figure with those before. In 1970–71, we had a total of 32,000. Did the hon. Member think that too low, and did he say so at the time? To go up from 32,000 to more than double that figure in just five years is to me a massive increase. How far indeed could we keep on increasing at that rate? If the hon. Member now thinks 72,000 too low a figure what number would he suggest?
My hon. Friend the Member for The Wrekin (Mr. Fowler) mentioned another aspect which tends to be overlooked. We are planning ahead on the use of resources up to 1990. We all know that these resources are not unlimited, and if we control them for home students it is only right that we control them also for overseas students. If we did not, the number of overseas students could well continue to rise, and a number of home students might well be deprived of places as a result. My right hon. Friend could not view such a prospect with equanimity. It is thus a question of balance—of admitting the number of overseas students that we can afford within the resources.
My hon. Friend talked about the late 1980s. Outside the House I made a speech about the extension of the university programme. My immediate problem as a Minister is not the late 1980s but the


run-up from now until 1982 with the increasing number of 18-year-olds available to go to university.
To any institutions which complain of the difficulty of complying with this policy, I can only say that the policy has been public knowledge since November 1976. Institutions were asked to begin to curb their intakes for 1977–78 as long ago as January 1977. If they now have problems in getting down to their limits for 1978–79 this can only be due to a large extent to a failure to heed earlier advice that the Department gave. In other words, the holding operation should have begun with the intake of September 1977, so that any remaining reduction next September would have been a more manageable step.
I am aware that some overseas students—and home students—face hardship as a result of the 1977–78 fee increase. However, many overseas students are supported under the Government aid programme or by their own Governments or by other sponsors. Moreover, a further 600 post graduate students get help with fees under the ODM's fee support scheme.
I have dwelt, I think justifiably, on the massive assistance by way of subsidy that we give overseas students. But we need still to consider very seriously whether we are using the resources that are available for the support of overseas students to the best advantage—both for them and for us. On this point I find myself in agreement with the hon. Member.
Let us not be too pious about this. Our motives in providing financial assistance for students from other countries are not entirely disinterested. There are, of course, deeper issues involved here; issues which have their origin in earlier colonial exploitation and which call for measures to avoid the whirlwind which otherwise we might well reap. But without delving into what some might dismiss as obscure moral issues—I myself would certainly not dismiss them—we can point to more concrete and current spin-offs.
There is no doubt that many an overseas student who acquires his technological skill in our educational institutions will, when he attains a position of influence in his own country, as many of them do, turns instinctively to a British

product and expertise. This is a hard fact, even if it is one that is difficult to quantify. It is thus to our economic advantage to provide support for such overseas students. But this is less than half the story. By all means let our mercenary instincts play their proper role; but let our moral duty here be paramount. I have said that the resources at our disposal are limited, and that we must consider how best they can be deployed. Given this, there is no doubt in my mind that we must devote the greater part of these limited resources to the support of those students who are most in need.
The present system in no way measures up to this requirement. Apart from those who attend special tailor-made courses charged at full economic cost, every overseas student who comes here on his own or his Government's initiative, whether he comes from the oil-richest sheikdom or the most destitute African republic—let us recall that many poor come from rich countries just as rich come from poor countries—receives a subsidy up to 70 per cent, or more, even when he pays the differential fee. This surely does not make sense.
The hon. Gentleman will be aware that we are giving very serious consideration to this matter. As I have indicated, we have to bear in mind the economic advantages that stem from the presence of overseas students in our institutions. We have also to bear in mind our obligations to our European partners in the EEC. But, above all, we must so arrange matters that the bulk of the available resources are channelled to those overseas students and to those countries that are the most deserving, and most in need, of help.
I do not take the comparison made with some European universities. Indeed, fees tend to be cheaper at some of those universities, but so is the standard of tuition. They have nothing like the system of student support and the ratio exists in our universities. I wish the hon. Gentleman had compared some of the costs in America and Canada with our costs and had not merely taken the overcrowded universities of our European partners.
Thus, I would not for a moment claim that our policy on overseas students is


perfect. That is why we have embarked on the longer-term study to which I have referred. Nevertheless the position we have already reached is surely impressive. We have many thousands of students here at present and we are devoting well over £100 million per annum to their education. That is not a bad record for any country—

The Question having been proposed after Ten o'clock and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at twenty-eight minutes past Eleven o'clock.